Categories
Politics

Pelosi urges U.S. Treasury not to delay $25 billion in grants to airlines

WASHINGTON (Reuters) – U.S. House Speaker Nancy Pelosi urged the U.S. Treasury on Wednesday not to hold up $25 billion in cash grants approved by Congress last week to airlines for payroll costs.

“We do want them to honor what our conversation was, which is this just a stopping off point for the check. It goes to the airline and directly to the employee,” Pelosi told reporters. A major aviation union and some airline officials are concerned the U.S. Treasury will demand too much in warrants or equity as a condition of the grants for airline payroll costs.

Source: Read Full Article

Categories
Business

Travel slump, sick staff force cash-worried U.S. airports to downsize

(Reuters) – With fewer planes flying and more security and traffic control officers testing positive for the coronavirus, airports are closing terminals, concessions and checkpoints, even while trying to retain jobs with the hope of a post-crisis pickup.

Orlando International Airport managers in Florida were this week considering turning a construction site for a runway rehabilitation into a parking lot for jets, while figuring out necessary staffing for increasingly deserted concourses.

People movers, for example, need maintenance even if they are not being used.

“You can’t just let it sit there,” said Phillip Brown, chief executive of the Greater Orlando Aviation Authority, which normally oversees millions of visitors a year to theme parks like Disney World and Universal Studios.

Those parks are closed into April and Orlando airport was instead setting up zones for screening passengers arriving from New York-area airports for the coronavirus following self-quarantine orders from Florida’s governor.

Florida, nicknamed the Sunshine State, has seen an increase in people fleeing New York with “shelter-in-place” orders.

Delta Air Lines (DAL.N) has closed terminals in New York and Los Angeles, and is using a runway in its hometown of Atlanta to park jets that are not flying.

More than 30 jets were parked at Atlanta’s Hartsfield-Jackson International Airport this week, a spokesman said.

Twenty-nine U.S. Transportation Security Administration (TSA) screening officers have tested positive at airports across the country in the past two weeks, the agency says, prompting checkpoint closures.

Even with the closures, U.S. airport screening wait times – often a source of public anger – are now routinely less than 10 minutes, reflecting dramatic falls in passenger numbers.

This week, TSA screened 454,000 passengers on Sunday, down 82% from a year ago, 331,000 on Monday, 279,000 on Tuesday, and 239,000 on Wednesday.

Still, airports are hoping that $10 billion in government aid under a massive relief package expected to pass on Friday can help keep employees on payroll and ready to work once operations ramp back up, Brown said.

The stimulus deal includes $3 billion for 125,000 contracted airport workers.

But until the health crisis has passed and people start flying again, airports that only a month ago were in the midst of expansion projects will continue to downsize as the industry weathers its biggest ever downturn.

San Francisco International Airport said it was closing some security checkpoints, creating a single Customs & Border Protection entry for international arrivals and delaying opening new gates at the revamped Harvey Milk Terminal 1, while evaluating other measures.

Fitch Ratings on Thursday revised its outlook for U.S. airport bonds to “negative.”

Source: Read Full Article

Categories
Business

Cash-strapped airlines resist mounting coronavirus refund claims

PARIS (Reuters) – European airlines waiting in line for coronavirus bailouts want to tap another source of interest-free loans: their customers.

Cash-strapped carriers are seeking to suspend European Union rules requiring refunds for cancellations and instead issue vouchers to customers left out of pocket as hundreds of thousands of flights are grounded by the pandemic.

Refund claims, if honored, would be a major additional cash drain on many airlines already in need of government aid to survive a sustained travel slump.

Consumer organizations say some major airlines are already flouting the refund rules and condemn what they describe as an attempt to force consumers to lend them cash.

“We’ve been absolutely inundated with passengers complaining they can’t get a refund from their airlines,” Rory Boland of British consumer group Which? said on Friday.

The European Commission has rejected industry calls to relax the requirement in EU regulations to refund cancellations within a week, but airlines say they are unable to comply.

“Faced with a cashflow catastrophe, many airlines can only offer vouchers in lieu of immediate cash refunds for canceled flights,” industry association Airlines for Europe (A4E) said.

A prolonged shutdown would make about 3.5 billion euros of Lufthansa (LHAG.DE) revenue eligible for refund in the second quarter, Citi estimates – ahead of the 3 billion euros at IAG (ICAG.L) or Air France-KLM, 770 million euros at easyJet (EZJ.L) and 760 million at Ryanair (RYA.I).

“Basically, we are trying to push as many vouchers as possible, and not allow for cancellations just to be refunded immediately,” Lufthansa’s finance chief Ulrik Svensson told investors last week.

A Lufthansa spokesman said on Friday that refunds remain “possible in principle”, but not “within the usual time limits”.

Air France-KLM (AIRF.PA), which like Lufthansa has grounded the vast majority of its flights, is telling clients it no longer offers the immediate refunds required under European law.

Instead it is issuing a customer credit valid for one year that can be refunded only at the end of that period.

“Air France recognises clients would normally receive immediate reimbursement,” its website says, blaming exceptional circumstances and “a very high number of refund requests”.

Airlines are now asking European authorities to waive refund requirements on condition that vouchers are reimbursable after a minimum of 12 months, an A4E spokeswoman said.

The EU has already relaxed airport slot rules and passenger compensation and will offer airlines more help, Transport Commissioner Adina Valean told Reuters. “But people have to receive their money back if that is what they want.”

Consumer groups remain unmoved by the industry’s pleas.

“It isn’t fair to people who have been left out-of-pocket and may be in financial difficulties themselves,” said Boland at Which? – who cited the example of a family denied a refund on their annual holiday booking to Florida.

“The airlines should not be asking to keep that family’s 2,000 pounds ($2,480),” he said.

Citi analyst Mark Manduca said airlines must do everything they can to ensure that “fees and taxes and anything that involves complaint money can be held to an absolute minimum during this tough time.”

“As a voucher holder, you end up effectively becoming an unsecured creditor of an airline,” Manduca added.($1 = 0.8068 pounds)

Source: Read Full Article

Categories
Politics

U.S. Senate offers $58 billion aid to airlines as they struggle to stay airborne

SYDNEY/SINGAPORE (Reuters) – The U.S. Senate offered struggling airlines unprecedented aid worth $58 billion that will helping cover their staff wages, as carriers around the world seek state support and turn passenger planes into cargo liners in their desperate bid for revenues.

The coronavirus crisis has ravaged the travel industry and grounded many of the world’s planes, prompting governments to take previously unthinkable steps to prevent bankruptcies, ranging from state handouts to temporarily halting competition rules.

“For airlines, it’s apocalypse now,” said Alexandre de Juniac, director general of the International Air Transport Association (IATA), which represents carriers around the world.

“Travel restrictions and evaporating demand mean that, aside from cargo, there is almost no passenger business,” he said.

IATA, which estimates the pandemic will cost the global industry $252 billion in lost revenues this year, said it had written to 18 countries in the Asia-Pacific region, including India, Japan and South Korea for emergency support for carriers.

Airlines UK, representing carriers in Britain, asked the government for tax and air traffic fee holidays.

The U.S. Senate passed an industry aid package, half in the form of grants to cover some 750,000 employees’ paychecks. Companies receiving funds cannot lay off employees before Sept. 30 or change collective bargaining agreements.

The bill has restrictions on stock buybacks, dividends and executive pay, and allows the government to take equity, warrants or other compensation as part of the rescue package.

The U.S. House of Representatives is expected to back the move on Friday. President Donald Trump has promised to sign it.

United Airlines Holdings said capacity would drop by 68% in April and Alaska Air Group said it would cut its schedule by 70% in April and May. American Airlines suspended its dividend, drew down a $400 million credit line and secured an additional loan.

CUTTING JOBS

In Asian countries, Singapore, Australia and New Zealand have announced some financial relief for airlines, but this has not stopped carriers from putting staff on leave and grounding planes.

Singapore’s finance minister Heng Swee Keat said Singapore Airlines Ltd would soon announce “corporate action” supported by state investor Temasek Holdings to tackle the crisis. Share trading in the carrier, which said this week it was seeking extra funds, was halted on Thursday.

Virgin Australia plans to permanently cut more than 1,000 jobs among the 8,000 staff that have already been stood down. Australia’s Flight Centre Travel Group said it would cut 6,000 travel agent roles globally.

In a move unthinkable under normal conditions, Australia’s competition regulator said it would allow Virgin, Qantas Airways and Regional Express to coordinate flight schedules and share revenue on 10 regional routes.

“We hope that this temporary measure will also support airlines’ ability to again compete with each other on these routes once the pandemic crisis has passed,” Australian Competition and Consumer Commission Chairman Rod Sims said.

In bid to raise revenue and keep some planes flying, Delta Air Lines and Air New Zealand joined others in offering cargo flights and charters on passenger planes.

About half of the world’s air cargo normally travels in the bellies of passenger planes, so the cancellation of passenger flights has led to a sharp reduction in cargo capacity.

“We’ve shared these options with our global cargo customer base and are getting some strong interest from customers wanting to ship to and from Shanghai, Hong Kong, San Francisco, Los Angeles, Sydney and Melbourne,” said Rick Nelson, Air New Zealand’s general manager for cargo.

Abu Dhabi’s Etihad Airways said it would operate 34 weekly cargo-only flights with Boeing 787 Dreamliner passenger jets to India, Thailand, Singapore, Philippines, Indonesia and South Korea.

Hawaiian Airlines said it had added more cargo-only turboprop flights between the state’s islands.

Roughly 1,800 planes had been grounded globally on Monday and Tuesday, according to aviation research firm Cirium.

Source: Read Full Article

Categories
Business

Airlines turn to cargo for revenue as U.S. Senate nears industry aid vote

SYDNEY/CHICAGO (Reuters) – Delta Air Lines Inc and Air New Zealand Ltd said they would offer cargo charter services on passenger planes to boost revenue as the U.S. Senate neared a vote on a bill to give its carriers $58 billion in aid, including payroll support.

The passenger travel industry has been decimated by the coronavirus pandemic, with Australia’s Flight Centre Travel Group Ltd on Thursday announcing plans to cut 6,000 travel agent roles globally, either temporarily or permanently.

Singapore Airlines Ltd on Thursday went into a rare trading halt pending an announcement, days after it said it would ground almost its entire fleet and seek more financing as it grapples with the coronavirus pandemic.

Virgin Australia Holdings Ltd plans to permanently cut more than 1,000 jobs among the 8,000 staff that have been stood down due to cuts to its flying schedule, Chief Executive Paul Scurrah said.

“That is going to be heartbreaking for those people. This is no fault of theirs,” Scurrah told the Australian Broadcasting Corp. “This is the worst airline crisis the industry has ever seen.”

New Zealand’s Auckland International Airport Ltd said it had cut 90 contractors and was talking to its staff about reducing hours and salaries by 20% as demand plummets.

In the United States, United Airlines Holdings Inc announced further cuts to domestic capacity, meaning its overall capacity, including international, will be down by around 68% in April.

Alaska Air Group Inc said it would cut its schedule by 70% in April and May and had suspended its dividend, drawn down a $400 million credit line and secured an additional $425 million loan to help weather the crisis.

The U.S. Senate is preparing to vote on an industry aid package, half in the form of grants to cover some 750,000 employees’ paychecks.

In a win for labour, companies receiving funds cannot lay off employees before Sept. 30 or change collective bargaining agreements.

The draft bill has restrictions on stock buybacks, dividends and executive compensation, and allows the government to take equity, warrants or other compensation as part of the rescue package.

In an effort to raise much-needed revenue and keep some planes in the air, Delta and Air New Zealand said they had joined the growing number of carriers offering cargo charters on passenger planes.

“We’ve shared these options with our global cargo customer base and are getting some strong interest from customers wanting to ship to and from Shanghai, Hong Kong, San Francisco, Los Angeles, Sydney and Melbourne,” Air New Zealand General Manager Cargo Rick Nelson said.

Around half the world’s air cargo normally travels in the bellies of passenger planes rather than dedicated freighters, so the cancellation of passenger flights has led to a sharp reduction in cargo capacity.

About 1,800 planes had been grounded globally on Monday and Tuesday, according to aviation research firm Cirium.

The International Air Transport Association (IATA), which represents the airline industry, said that red tape is holding up medical and other emergency supplies needed to help tackle the coronavirus crisis.

Examples include two shipments, each containing about five to 10 tonnes of medical supplies, bound for Latin America and currently held up in Dubai and India.

Figures to be published next week will show global air freight traffic fell around 10% in February, putting it on course for a 15%-20% drop for the year as a whole, IATA said.

Source: Read Full Article

Categories
Business

'Strings attached': Governments offer financial lifelines to airlines, at a price

SYDNEY/WASHINGTON (Reuters) – Shattered airlines were left counting the cost of government support as politicians in the United States and New Zealand set out conditions for bailouts needed to absorb the shock of coronavirus.

Conditions include provisions that loans may convert to government equity stakes, with Air New Zealand Ltd’s (AIR.NZ) bailout also dependent on suspending its dividend and paying interest rates of 7% to 9%, while U.S. airlines cannot increase executive pay or provide “golden parachutes” for two years.

New Zealand on Friday offered its national carrier a NZ$900 million ($510 million) lifeline, which Finance Minister Grant Robertson said would help it survive after the government banned all non-resident arrivals to the country.

“That puts us in a very good position over the next several months,” Air New Zealand chief executive Greg Foran told reporters of the loan, which it will not draw down immediately. “We would expect the airline industry will look different at the end of this. Not all airlines are going to survive.”

Under the $58 billion U.S. proposal for passenger and cargo carriers, the U.S. Treasury Department could receive warrants, stock options, or stock as a condition of government assistance in order for the government to participate in gains and be compensated for risks.

“We are not bailing out the airlines or other industries – period,” U.S. Senate Appropriations Committee Chairman Richard Shelby said in a statement. “Instead, we are allowing the Treasury Secretary to make or guarantee collateralized loans to industries whose operations the coronavirus outbreak has jeopardized.”

Norway will back airlines with credit guarantees worth up to 6 billion Norwegian crowns ($537 million), half of it to Norwegian Air Shuttle ASA (NWC.OL), but conditions include raising money from commercial lenders and the equity market.

The International Air Transport Association (IATA) has forecast the industry will need up to $200 billion of state support, piling pressure on governments facing demands from all quarters and a rapid worsening in public finances as economies slump.

“Money is very tight in most countries so governments need to step back and be hard-nosed about any form of rescue, which could come in various forms – cash, equity, loans, bonds etc – but it all must come with strict conditions or strings, attached,” Shukor Yusof, head of Malaysia-based aviation consultancy Endau Analytics, said in an email.

Even with financial assistance, airlines around the world are placing thousands of workers on unpaid leave, deepening the shocks to local economies.

Air Canada (AC.TO) has more than 5,100 excess cabin crew after cutting its flying schedule and plans to start notifying them they will be laid off at least temporarily, its flight attendants union said in a statement.

The airline said it had begun talks with unions about temporary lay-offs but did not have final numbers yet.

On Friday, Cathay Pacific Airways Ltd (0293.HK) said it would slash passenger capacity by 96%, and possibly more in April and May, as new government curbs make travel more difficult.

Its low-cost carrier, HK Express, will suspend operations from Monday until April 30, bringing forward plans to put employees on unpaid leave.

Some airlines are looking to place their staff with temporary employers. Air New Zealand may redeploy some workers to the government, possibly in health roles and contact tracing, New Zealand’s finance minister told reporters.

Qantas Airways Ltd (QAN.AX) is talking to Australian retailer Woolworths Group Ltd (WOW.AX) about job opportunities as grocery sales surge, while more than 1,000 laid-off SAS (SAS.ST) airline workers in Sweden are being offered fast-track healthcare training to help fight the coronavirus.

The only bright spot for the industry is the cargo market. Passenger planes normally carry about half the world’s air cargo in their bellies, with the remainder hauled in dedicated freighter aircraft.

The collapse in passenger flights has tightened the cargo market, leading some carriers to fly planes empty of passengers and baggage but with cargo in their bellies.

American Airlines Group Inc (AAL.O) said on Thursday it would use some of its grounded Boeing 777 passenger jets to move cargo between the United States and Europe, in its first scheduled cargo-only flights since 1984 when it retired the last of its 747 freighters.

Normally 65% of cargo capacity from mainland Europe and the Britain to the United States is belly space on passenger aircraft, according to Seabury Consulting.

“Space is available, but at premium rates and without transit time guarantees,” logistics company Agility said on its website.

In the Asia-Pacific, Qantas, Cathay, Korean Air Lines Co Ltd (003490.KS) are also operating some flights with empty seats but bellies full of cargo.

Source: Read Full Article

Categories
Business

Governments offer financial lifelines to airlines, at a price

SYDNEY/WASHINGTON (Reuters) – Shattered airlines were left counting the cost of government support as politicians in the United States and New Zealand set out conditions for bailouts needed to absorb the shock of coronavirus.

Conditions include provisions that loans may convert to government equity stakes, with Air New Zealand Ltd’s (AIR.NZ) bailout also dependent on suspending its dividend and paying interest rates of 7% to 9%, while U.S. airlines cannot increase executive pay or providing “golden parachutes” for two years.

New Zealand on Friday offered its national carrier a NZ$900 million ($510 million) lifeline, which Finance Minister Grant Robertson said would help it survive after the government banned all non-resident arrivals to the country.

Under the $58 billion U.S. proposal for passenger and cargo carriers, the U.S. Treasury Department could receive warrants, stock options, or stock as a condition of government assistance in order for the government to participate in gains and be compensated for risks.

“We are not bailing out the airlines or other industries – period,” U.S. Senate Appropriations Committee Chairman Richard Shelby said in a statement. “Instead, we are allowing the Treasury Secretary to make or guarantee collateralized loans to industries whose operations the coronavirus outbreak has jeopardised.”

Norway will back airlines with credit guarantees worth up to 6 billion Norwegian crowns ($537 million), half of it to Norwegian Air Shuttle ASA (NWC.OL), but conditions include raising some money from commercial lenders and the equity market.

The International Air Transport Association (IATA) has forecast the industry will need up to $200 billion of state support, piling pressure on governments facing demands from all quarters and a rapid worsening in public finances as economies slump.

“The longer this crisis lasts, the more likely it is that the future of aviation cannot be guaranteed without state aid,” Carsten Spohr, chief executive of Germany’s Lufthansa said on Thursday.

Lufthansa, which has idled 700 of its 763 aircraft, has already held talks with the German government on providing liquidity, including through special loans from state development bank KfW.

Former U.N. ambassador Nikki Haley resigned from Boeing Co’s (BA.N) board on Thursday after opposing its bid for $60 billion in government financial assistance for the U.S. aviation manufacturing industry.

Even with financial assistance, airlines around the world are placing thousands of workers on unpaid leave, deepening the shocks to local economies.

The only bright spot for the industry is the cargo market. Passenger planes normally carry about half the world’s air cargo in their bellies, with the remainder hauled in dedicated freighter planes.

The collapse in passenger flights has tightened the cargo market, leading some carriers to fly planes devoid of passengers and baggage but with cargo in their bellies.

American Airlines Group Inc (AAL.O) said on Thursday it would use some of its grounded Boeing 777 passenger jets to move cargo between the United States and Europe, in its first scheduled cargo-only flights since 1984 when it retired the last of its 747 freighters.

Normally 65% of cargo capacity from mainland Europe and the Britain to the United States is belly space on passenger aircraft, according to Seabury Consulting.

“Space is available, but at premium rates and without transit time guarantees,” logistics company Agility said on its website.

In the Asia-Pacific region, Qantas Airways Ltd (QAN.AX), Cathay Pacific Airways Ltd (0293.HK), Korean Air Lines Co Ltd (003490.KS) are also operating some flights with empty seats but bellies full of cargo.

Source: Read Full Article

Categories
Business

Brought to the brink by coronavirus, airlines seek emergency aid

LONDON/PARIS (Reuters) – Airlines made unprecedented cuts to flights, costs and staffing on Monday, stepping up calls for emergency aid as coronavirus lockdowns and new travel restrictions hit more major routes.

Already battered shares in British Airways parent IAG (ICAG.L), easyJet (EZJ.L) and Air France-KLM (AIRF.PA) plunged again as they scrapped most flights for the coming weeks, joining other major carriers that are all but halting operations in the face of the pandemic.

“It is now clear that the coronavirus is by far the biggest crisis in the history of aviation,” Finnair Chief Executive Topi Manner said, as the carrier announced a 90% capacity reduction and its second profit warning in three weeks.

The outlook darkened further after Spain declared a state of emergency and the United States extended travel curbs to Britain and Ireland, while Australia and New Zealand began requiring all travelers to self-isolate. Germany advised citizens against non-essential trips abroad.

The travel collapse threatens more bankruptcies in the wake of British carrier Flybe’s failure this month.

Troubled Norwegian Air (NWC.OL) on Monday laid off 90% of its workforce and canceled 85% of flights, while the Italian government prepared to take control of Alitalia with another cash injection of 600 million euros ($668 million).

In an unusual joint statement, the world’s three main airline alliances – oneworld, SkyTeam and Star Alliance – called for government aid to alleviate the “unprecedented challenges” faced by the industry.

U.S. officials and lawmakers view the situation with increasing alarm. United (UAL.O), American (AAL.O) and Delta Air Lines (DAL.N) are in talks with the government about potential assistance backed by pilot and flight attendants’ unions. Tax relief and federal loans are being considered, officials say.

IAG, which also owns Spain’s Iberia and Vueling, said it would cut April-May capacity by at least 75% and postpone CEO Willie Walsh’s retirement – keeping successor Luis Gallego at Iberia’s helm as the group navigates the crisis.

Besides cancelling flights, the group announced moves to freeze discretionary spending, reduce working hours and temporarily suspend employment contracts.

Related Coverage

  • Airlines count mounting costs of the coronavirus shock
  • Brazil's Azul cuts international flights; carriers expect government aid

Budget carriers Ryanair (RYA.I) and easyJet announced plans to ground most of their fleets, with the latter echoing calls for government help.

“Coordinated government backing will be required to ensure the industry survives,” easyJet CEO Johan Lundgren said.

In Europe, IAG’s shares had fallen 25% by 1413 GMT, while Ryanair was down 18%, easyJet down 17% and Air France-KLM 17% lower. In New York, Delta was down 18%, and American 15% lower.

“Airlines are siphoning cash and have no way of stopping it” as bookings grind to a halt and traffic collapses for six to eight weeks, Bernstein analyst Daniel Roeska said.

With carriers’ survival now in government hands, he added, “the key focus should be on emergency liquidity support and enabling short-term layoffs or working-hour reductions to safeguard cash.”

The German, French, Dutch and British governments have all said they are considering ways to help the industry.

‘UNPRECEDENTED’

IAG’s Walsh, who has railed against state aid to rivals throughout his career, said airlines should continue to try self-help first.

But he added: “Clearly where governments are providing general support particularly for employees that are being impacted by the current crisis, we would avail (ourselves) of those general facilities.”

BA’s archrival Virgin Atlantic said on Monday it would axe London-Newark flights permanently and ask staff to take two months of unpaid leave.

Air France-KLM said it would park its entire Airbus A380 and Boeing 747 fleets as it reduces operations by 90% and discusses emergency aid with the French and Dutch governments. CEO Ben Smith also told staff on Monday he had cut his own pay by 25%.

The group will use government-funded partial layoffs to find 200 million euros in cost-cuts as it reins in capital expenditure by a further 350 million.

Airlines are also likely to postpone new jet deliveries, a prospect weighing on Boeing (BA.N) and Airbus (AIR.PA), whose shares were down 18%. Aircraft and engine makers also face a slump in parts and maintenance sales as air traffic withers.

“Demand is drying up in ways that are completely unprecedented,” aviation consultant CAPA said in a report, predicting that most global airlines would go bust by June without government help. “Normality is not yet on the horizon.”

Cathay Pacific struck a leaseback deal to transfer six of its Boeing 777s to BOC Aviation Ltd (2588.HK) for $704 million in precious cash, the Hong Kong-based carrier announced on Monday – along with its own 90% capacity cut.

Azul scrapped international flights from its main Sao Paulo hub, and Chile’s Latam warned of further cuts.

Germany’s Tui AG (TUIGn.DE) and Scandinavian carrier SAS (SAS.ST) also said they were suspending the vast majority of operations and seeking government aid.

Finnair (FIA1S.HE) predicted a substantial loss this year as it announced the near-halt of operations and scrapped its dividend. Icelandair (ICEAIR.IC) also slashed capacity and said it was in union talks to cut its wage bill.

Earlier, United Airlines (UAL.O) said March revenue had dropped by $1.5 billion and planes may remain near-empty into the summer even after severe schedule cuts. “This crisis is moving really quickly,” CEO Oscar Munoz and President Scott Kirby told employees in a Sunday memo.

Air New Zealand Ltd (AIR.NZ), which has halted trading in its shares until Wednesday, also plans job cuts after cutting long-haul capacity by 85%, CEO Greg Foran warned.

“For the coming months at least, Air New Zealand will be a smaller airline requiring fewer resources, including people,” he said.

(Graphic: European airlines battered by coronavirus, here)

Source: Read Full Article

Categories
Business

Virgin Atlantic boss seeks 7.5 billion-pound UK airline bailout: Sky News

(Reuters) – Virgin Atlantic’s chairman Peter Norris will write to British Prime Minister Boris Johnson on Monday saying the country’s airline industry needs emergency government support worth 7.5 billion pounds ($9.20 billion) or risks the loss of tens of thousands of jobs, Sky News reported on Saturday.

The letter would ask the British government to provide airlines with a credit facility to help them through a potentially prolonged period of slumping revenue amid the coronavirus pandemic, Sky News said, citing sources.

Source: Read Full Article

Categories
Business

Coronavirus wipes $70 billion off global listed airlines

LONDON (Reuters) – The rapid spread of coronavirus has wiped almost a third – or $70 billion – off the world’s top 20 listed airlines and reshuffled global rankings, elevating Air China into third place behind U.S. rivals, an analysis by Reuters shows.

The airline sector has been hit hardest by the outbreak of coronavirus, with falling ticket demand and Italy in lockdown forcing carriers to cancel routes and slash costs to survive the mounting crisis.

With the investor sell-off accelerating, United Airlines (UAL.O) has lost its number three position in the global line-up to Air China (601111.SS).

The U.S. carrier’s market capitalization has halved to $11.6 billion, the lowest since 2003, since the start of the year, leaving it also lagging behind Europe’s low-cost carrier Ryanair (RYA.I).

Air China has been relatively unscathed – its market cap was $15 billion on Tuesday, compared with $19 billion on Jan. 2.

The scale of the rout has been breathtaking.

Wizz Air, a budget carrier focused on central European routes, is now more highly valued than Air France-KLM, and the world’s most valuable airline, Delta Air, has seen more than $10 billion knocked off its value this year, taking its market cap to about $28 billion, the lowest since September 2016.

(Graphic: Global airlines by market cap – here)

Source: Read Full Article