As uncertainty continues to plague the airline industry low-cost carrier easyJet is today saying that it could be forced to ground most of its 300 aircraft. This latest news comes as airlines around the world try to come to grips with declining passenger numbers and restrictions being enforced due to the coronavirus pandemic.
As the Luton Airport-based airline tries to consolidate its operations, it has promised to continue flying rescue flights to bring passengers home.
easyJet will continue to repatriate passengers
In a statement carried by Sky News about repatriating passengers, the airline said it would continue to operate rescue flights for short periods “where we can” to repatriate passengers; however, it would also be cutting operations further.
“These actions will continue on a rolling basis for the foreseeable future and could result in the grounding of the majority of the easyJet fleet.”
Chief executive Johan Lundgren added:
“At easyJet we are doing everything in our power to rise to the challenges of the coronavirus so that we can continue to provide the benefits that aviation brings to people, the economy and business.
“European aviation faces a precarious future and it is clear that coordinated government backing will be required to ensure the industry survives and is able to continue to operate when the crisis is over.”
British Airways business is down 75%
IAG the owner of British Airways said today that the coronavirus outbreak and the travel restrictions associated with it were “having a significant and increasingly negative impact” on just about every one of the airlines’ routes.
The British national flag carrier said that it is expecting capacity in April and May to be down 75% of the previous year.
In an effort to combat losses, British Airways is grounding aircraft, freezing hiring and spending, while also asking staff to take voluntary leave.
Chief executive of IAG Willie Walsh said:
“We have seen a substantial decline in bookings across our airlines and global network over the past few weeks and we expect demand to remain weak until well into the summer. We are therefore making significant reductions to our flying schedules.
“We will continue to monitor demand levels and we have the flexibility to make further cuts if necessary. We are also taking actions to reduce operating expenses and improve cash flow at each of our airlines. IAG is resilient with a strong balance sheet and substantial cash liquidity.”
Looking at the markets in early trading, we can see that shares in IAG were down by 21% while those of easyJet were trading 28% lower.
This weakness in demand comes after a major aviation consultancy firm warned that if governments did not step in to help airlines, many of them would be bankrupt by the summer.
According to CAPA Centre for Aviation, who issued the warning, “Demand is drying up in ways that are completely unprecedented,” CAPA said in a report. “Normality is not yet on the horizon.”
While counties like Italy, Spain, and France are all on lockdown in an attempt to stop the spread of the coronavirus, other countries have imposed a 14-day self-quarantine for arriving passengers.
The United States has now banned all flights from Europe, with other countries almost certain to follow suit.
Airlines could help stop the coronavirus from spreading
The fact remains that if airlines continue to fly and passengers continue to travel, there is no way that they will ever be able to stop the coronavirus from spreading.
Airlines could play a big part in stopping the spread of the coronavirus by voluntarily grounding their fleets until the outbreak is under control.
In the meantime, it will be up to governments around the world to tell the banks and energy suppliers that they will have to stop billing customers until the virus is contained and it is safe for people to go back to work.
What do you think should airlines keep flying or should they like SAS cancel all flights and ground their fleets? Please let us know your thoughts in the comments.