Tag: Airline

All Korean Air executives will forgo part of their salaries in response to the worsening business environment due to the Covid-19 virus outbreak.

Korean Air announced that salaries of its executive vice presidents and above will be reduced by 50 per cent senior vice presidents by 40 per cent, and managing vice presidents by 30 per cent, starting from April.

Korean Air will also take other self-rescue measures to improve its financial structure.

In addition to the previously announced sale of idle assets, such as the Songhyeon-dong site, the airline will actively seek to raise funds by selling other non-core assets.

An internal emergency response committee and a special task force team has been established to evaluate and respond to the current crisis caused by Covid-19.

Also, while striving to reduce operation costs, the airline is proactively exploring business opportunities such as boosting cargo operations by utilising passenger jets as freighters.

Korean Air is currently offering services to 21 destinations, having grounded the majority of its aircraft, including all ten Airbus A380 superjumbos.

airBaltic

President and chief executive of airBaltic, Martin Gauss, has announced that he will give up his salary during the crisis thus supporting the company in coping with this extraordinary situation.

Gauss said: “Starting from April until we can start scheduled operations again, I will receive no salary and members of the board, the supervisory board and managers have taken already a volunteer pay cut of 20 per cent from their salary.”

The ongoing coronavirus crisis has forced airBaltic to ground all flights.

The carrier is currently working on restarting its scheduled operations once it is possible.

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The UK chancellor has ruled out government help for struggling airlines, at least in the short term.

Having previously pledged to work with carriers to overcome the financial difficulties created by the coronavirus pandemic, Rishi Sunak has now advised airlines to find other forms of funding.

Demand for tickets has collapsed forcing companies to ground aircraft.

British Airways and Virgin Atlantic are operating severely restricted schedules, while Ryanair and easyJet are grounding nearly their entire fleets.

Aviation bosses have been lobbying the government for a targeted aid package to stop firms going under as a result of the slump in demand.

However, in a letter on Tuesday, Sunak said the government would only step in as “a last resort”.

The chancellor instead urged airlines to try and raise money from shareholders.

He added the government would only enter into negotiations with individual airlines once they had “exhausted other options”.

Richard Branson yesterday announced he would invest $250 million in Virgin Group in order to avoid redundancies.

At the same time, Norwegian has been able to access government funding for its operations.

IATA

The government decision comes as IATA predicts global aviation revenue could fall by nearly half this year.

The group said annual worldwide revenues from ticket sales would fall by $252 billion if travel bans remain in place for three months, a drop of 44 per cent compared to last year.

“It did not seem possible, but in a matter of days, the crisis facing airlines worsened dramatically.

“We are 100 per cent behind governments in supporting measures to slow the spread of Covid-19,” said IATA director general Alexandre de Juniac.

“But we need them to understand that without urgent relief, many airlines will not be around to lead the recovery stage.

“Failure to act now will make this crisis longer and more painful.

“Some 2.7 million airline jobs are at risk.

“And each of those jobs supports a further 24 in the travel and tourism value chain.

“Some governments are already responding to our urgent calls, but not enough to make up the $200 billion needed,” added de Juniac.

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Aegean has confirmed the temporary suspension of all international flights from Thursday.

The move comes as the airline battles the extraordinary circumstances surrounding the Covid-19 pandemic.

Travel restrictions imposed by Greece, the EU and other states, as well as the newly adapted measures for the restriction of unnecessary movements in the country, have made operations impossible, Aegean said.

The carrier added the move, which will remain in place until at least April 30th, would ensure the sustainability of its long-term operations.

A small number of weekly flights from Athens to Brussels will be operated, in order to maintain Greek connectivity with the administrative centre of the European Union.

Aegean said it would also operate repatriation or other emergency flights in cooperation with the general secretariat for civil protection and the ministry of foreign affairs.

A total of eight repatriation flights have already been operated by Aegean, from Morocco, Spain, Czech Republic, Poland, Serbia and Georgia on behalf of the Greek state.

A further flight, from London to Larnaca, took place on behalf of the republic of Cyprus.

A limited frequency service to all domestic airports will be maintained, aiming to facilitate minimum essential connectivity for the needs of the islands.

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Qantas and Jetstar have confirmed the majority of their 30,000 employees will be asked to stand down until at least the end of May as global travel comes to a virtual standstill during the coronavirus outbreak.

Earlier this week, cuts to 90 per cent of international flying and about 60 per cent of domestic flying were announced by the carriers.

During the stand down, employees will be able to draw down on annual and long-service leave.

Additional support mechanisms will be introduced, including leave at half pay.

Employees with low leave balances at the start of the stand down will be able to access up to four weeks’ leave in advance of earning it.

However, periods of leave without pay for some employees are inevitable, Qantas said in a statement.

Senior group management executives and the board have increased their salary reductions from 30 per cent to 100 per cent until at least the end of this financial year, joining the chairman and group chief executive in taking no pay.

Annual management bonuses have also been cancelled.

Qantas Group chief executive, Alan Joyce, said: “The efforts to contain the spread of coronavirus have led to a huge drop in travel demand, the likes of which we have never seen before.

“This is having a devastating impact on all airlines.

“We’re in a strong financial position right now, but our wages bill is more than $4 billion a year.

“With the huge drop in revenue we’re facing, we have to make difficult decisions to guarantee the future of the national carrier.”

With the federal government now recommending against all overseas travel from Australia, regularly scheduled international flights will continue until late March to assist with repatriation.

They will then be suspended until at least the end of May.

As the national carrier, Qantas is in ongoing discussions with the government about continuation of some strategic links.

More than 150 aircraft will be temporarily grounded, including all of Qantas’ A380s, Boeing 747s and Boeing 787-9s and Jetstar’s B787-8s. 

Discussions are progressing with airports and government about parking for these aircraft, Qantas said.

Essential domestic, regional and freight connections will be maintained as much as possible.

Joyce added: “The reality is we’ll have 150 aircraft on the ground and sadly there’s no work for most of our people.

“Rather than lose these highly skilled employees who we’ll need when this crisis passes, we are instead standing down two-thirds of our 30,000 employees until at least the end of May.

“Most of our people will be using various types of paid leave during this time, and we’ll have a number of support options in place.

“We’re also talking to our partners like Woolworths about temporary job opportunities for our people.”

Given the current extraordinary circumstances, a decision has been made to defer payment of the shareholder dividend announced on February 20th from April until September.

This is in addition to the cancellation of the off-market buy back, previously announced.

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Cebu Pacific will suspend all flight operations from Thursday until April 14th.

The Philippine government recently implemented an enhanced community quarantine over Luzon, and similar directives across various provinces in the country.

Cebu Pacific has taken the decision to ground its planes in compliance with the quarantine measures, land travel restrictions and regulations in place.

“We are also working closely with the authorities to assist in flying stranded passengers in and out of the Philippines,” the carrier said.

Cebu Pacific will offer a small number of flights from Singapore, Bangkok, Tokyo, Osaka, Nagoya, Ho Chi Minh and Taipei to Manila today.

All passengers can check their flight status on the Cebu Pacific website website.

“As this is a developing situation that is unprecedented, Cebu Pacific will continue to monitor the situation and provide updates as soon as possible.

“We thank everyone for their patience and understanding, as our flight, operations and frontline teams continue to do their best to assist passengers,” added a statement.

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International Airlines Group plans to cut capacity by at least 75 per cent in April and May as the company battles the coronavirus pandemic around the world.

The group – which operates British Airways, Iberia and Aer Lingus – said it was also taking drastic actions to reduce operating expenses and improve cash flow.

These include grounding surplus aircraft, reducing and deferring capital spending, cutting non-essential and non-cyber related IT spend and freezing recruitment.

At the same time, IAG is implementing voluntary leave options, temporarily suspending employment contracts and reducing working hours.

In light of the exceptional circumstances facing the aviation industry due to Covid-19, and in particular the developing situation in Spain, it has been decided that Luis Gallego will continue in his role as Iberia chief executive for the next few months to lead the response in Spain.

In the meantime, Willie Walsh, who had been due to this month, will continue to act as group chief executive.

Javier Sanchez will remain in place as Vueling chief executive.

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.”

The group – which saw its share price dip a further 20 per cent this morning – said it had a “strong liquidity” position, with cash, cash equivalents and interest-bearing deposits of €7.35 billion as at March 12th.

In addition, undrawn general and committed aircraft backed financing facilities amount to €1.9 billion, resulting in total liquidity of €9.3 billion.

To date, IAG has suspended flights to China, reduced capacity on Asian routes, cancelled all flights to, from and within Italy and made various changes to our network.

The US presidential announcement to restrict entry of foreign nationals who have been in countries in the Schengen Area, the UK and Ireland has added to the uncertainty on North Atlantic routes, IAG said.

In addition, many other countries have banned or are restricting inward travel including Argentina, Chile, India and Peru.

Spain has also been the subject of travel advisories, for example by the UK Foreign & Commonwealth Office.

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Heathrow welcomed 5.4 million passengers in February, down 4.8 per cent on last year after adjusting for the extra leap day.

The fall was largely due to lower demand on Asian and European routes in the wake of the coronavirus outbreak.

Demand has continued to weaken going into March, Heathrow officials said, with a further year-on-year decrease expected in coming weeks.

Heathrow chief executive, John Holland-Kaye, said: “The threat of coronavirus is an increasing challenge for the UK, and we are working day and night to ensure Britain’s front door is open and safe for our people and passengers.

“We will continue to work with the government to limit the impacts this will have on UK plc.”

Regular deep cleaning has been introduced across all Heathrow terminals as well as increased availability and provision of hand sanitisers.

A dedicated Public Health England team remains in place at the airport, implementing clinically-informed, evidence-driven processes to support passengers showing symptoms of the virus.

Current processes include an early warning system allowing airline crew to report any illness on board flights ahead of landing.

In February, the airport saw over 115,800 metric tonnes of cargo pass through its doors, down 9.5 per cent, as the effect of coronavirus was felt on global trade.

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Construction workers have reached a major milestone in the Manchester Airport transformation programme, with Laing O’Rourke completing the main build phase of the terminal two extension.

The milestone is a hugely significant achievement coming a little over two and half years since MAG signed the contract with Laing O’Rourke.

It also confirms the project remains fully on course to go-live in July.

MAG programme delivery director, Rob Stewart, commented: “One year on from the completion of pier one and the west multi storey car park, this on time milestone achievement represents the culmination of a huge collaborative effort by MAG and our team of experienced delivery partners.

“Everyone involved should feel extremely proud and the wider community excited about this fabulous facility coming online in July.” 

Now the terminal extension has been handed over it will go through a range of trials and fit outs before opening to passengers.

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