In Brief

Coronavirus: Virgin Atlantic tells staff to take unpaid leave

Move comes amid warnings that global pandemic could bankrupt aviation industry

Virgin Atlantic staff are to be asked to take eight weeks of unpaid leave over the next three months, to help the airline cope during the coronavirus pandemic.

The airline is planning to cut 80% of flights and ground 75% of planes in response to the global outbreak, which threatens to take a wrecking ball to the aviation industry.

The carrier is also planning decreases to staff salaries and a reduction in sick pay to 12 weeks full pay. It will also offer voluntary redundancies, alongside sabbaticals of between six to 12 months.

A Virgin Atlantic spokesperson said that the move was a response to “unprecedented pressure” on the industry, echoing calls for the government to give “clear, decisive and unwavering support”.

They added that airlines will only “weather this storm and emerge in a position to assist the nation’s economic recovery” if the government provides financial aid.

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According to The Daily Telegraph, the appeal for government aid comes to the backdrop of a growing disagreement between Virgin Atlantic and British Airways over calls for a £7.5bn state bailout.

The paper reports that Virgin Atlantic, which is backed by billionaire businessman Richard Branson and US airline Delta, has asked for emergency government loans. However, the owner of rival BA has insisted no further aid is needed. 

Elsewhere, Ryanair says it is expecting to ground the majority of its fleet across Europe over the next seven to 10 days due to the travel restrictions put in place this week. 

The budget carrier said it could also reduce seat capacity by 80% and ground its entire fleet in April and May.

Other airlines to announce drastic route cuts and plane groundings yesterday include American Airlines, United Airlines, SAS, Air France-KLM and Air New Zealand.

One aviation consultancy told Sky News that coronavirus could leave the entire industry just months away from collapse.

“By the end of May 2020, most airlines in the world will be bankrupt,” the Centre for Aviation said. “Coordinated government and industry action is needed - now - if catastrophe is to be avoided.

“As the impact of the coronavirus and multiple government travel reactions sweep through our world, many airlines have probably already been driven into technical bankruptcy, or are at least substantially in breach of debt covenants,” it added.

The Guardian reports that share prices in virtually all airlines have collapsed by more than 50% since the coronavirus crisis struck Europe.

“This crisis is going to be grim,” said Jon Horne, president of the European Cockpit Association, last week. “It is neither a Gulf war nor Sars, nor 9/11, or the 2008 financial crisis, but all of them together.”

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