IAG, the owner of British Airways, will cut more flights

IAG, the owner of British Airways, will cut more flights

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Reuters

IAG, the owner of British Airways, is cutting more flights over the next three months as demand for air travel continues to shrink.

The IAG, which also runs Ayr Lingas and Iberia, said the segregation restrictions meant it would be below 60% of 2019 levels this fall.

The group said it saw a “delayed recovery” and did not expect business to return to 2019 levels by 2023.

The IAG further said that the BAIT has reached the outline of a work contract.

The union has sparked bitter controversy with BA over rehabilitation and pay cuts.

The airline, which aims to employ 13,000 people, said that at the end of August, about 6.2 million people had left the business, “mostly as a result of voluntary redundancy.”

It is expected that a ballot on the deal will be held soon.

Booking is slow

The IAG’s decision to cut more flights than planned follows its forecast for a 46% reduction from October to December compared to the same quarter last year.

  • Virgin Atlantic will cut another 1,150 jobs
  • Gatwick Airport plans to cut 600 jobs

It said it had seen “almost complete closure of new booking activities” in April and May due to the epidemic, but ticket sales increased in June as a result of the country’s lockdown facilitation.

However, since July there has been an “overall leveling in bookings” as the UK and other European countries have re-imposed segregation requirements for returning passengers from countries such as Spain.

EasyJet revealed on Tuesday that it would fly “slightly less” than 40% of the previous coronavirus epidemic, having previously said it would operate between July and September following the government’s decision to restrict the separation of the seven Greek islands.

Boris Johnson’s appeal

Airlines are among the most affected by the epidemic. Due to the crisis, British Airways plans to cut 13,000 jobs, while EasyJet and Virgin Atlantic each surpass 4,500 roles.

Operators say the UK’s travel quarantine policy – which requires visitors from high-risk countries to be isolated on their return – is crushing demand and instead the government wants to bring tests back to airports.

Sources in the UK government have indicated that they are looking at a system where two tests could be up to eight days apart to further reduce the risk of “false negative” results.

They have yet to approve the idea, although the prime minister warned last week that testing at airports could give a “misconception of security.”

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PA Media

In a joint letter to Prime Minister Boris Johnson on Thursday, Airlines UK, whose members include BA, Virgin, Rainer and EasyJet, called for an extension of their employment fallow projects and flight passenger tax exemptions.

“Our industry is in crisis,” the letter said. “In short, we urge you to work urgently to implement a program of recovery in our sector.”

Growing money

The IAG also announced Thursday that shareholders are tapping € 2.7bn (£ 2.5bn) to further increase its financial spending.

The agency said the money would help reduce debt and endure a prolonged recession in travel.

Under the fundraising, existing investors will buy new shares at a deep discounted price – 36% below the closing price on Wednesday.

The group’s largest shareholder, Qatar Airways, which has a 25.1% stake, has said it will buy the entire title.

The rights issue was unveiled in July, two days after new chief executive Luis Gallego took over from longtime boss Willie Walsh.

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