Feb 28, 2020

BA parent IAG and easyJet report tumbling demand as virus spreads

London-listed airline groups IAG and easyJet have each reported a substantial knock to demand from the spread of coronavirus and announced measures ranging from hiring freezes to aircraft redeployment as they seek to cushion the blow. IAG, the parent of British Airways and Spain's Iberia, said it expects capacity to be hit by 1 to 2 per cent in terms of available seat kilometres, a key industry metric, as it cancels flights and bookings slow. IAG said the cancellation of industry events and corporate travel restrictions had hit business travel particularly hard. Shares in IAG and easyJet have each fallen by around a quarter since last month. In an attempt to offset some of the impact, IAG said British Airways had redeployed some of the freed-up long-haul capacity from the Asian flight reductions by adding extra services to destinations with stronger demand such as India, South Africa and the US. EasyJet said it was looking to offset the effects by freezing recruitment, cutting administrative costs, offering unpaid leave to employees and redeploying aircraft.

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