British Airways-owner, easyJet make drastic cuts to try to survive coronavirus

LONDON (Reuters) – The owner of British Airways and easyJet, Europe’s no.3 and no.4 airlines, said they would cut capacity drastically to try to survive the coronavirus outbreak which has stopped people traveling around the world.

IAG (L:), the owner of BA, said it would cut its flying capacity by at least 75% in April and May and its outgoing boss Willie Walsh would defer his retirement. The airline group, however, did not call for government help.

EasyJet (L:) said it could ground the majority of its fleet on a rolling basis, and its chief executive Johan Lundgren called for coordinated government backing to help the aviation industry survive.

Both airlines said they had strong balance sheets, providing details on their cash positions and credit facilities.

IAG, which also owns Iberia and Aer Lingus, said it had total liquidity of 9.3 billion euros, while easyJet said it had 1.6 billion pounds of cash plus an undrawn $500 million revolving credit facility.

While IAG’s Walsh has long-opposed any government help for aviation businesses, and said as recently as two weeks ago that government’s should not prop up airlines, EasyJet’s Lundgren called for help.

“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,” Lundgren said in a statement on Monday.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.