Wizz warns it will park planes to save cash if re­stric­tions con­tinue

The Daily Telegraph - Business - - Business - By Oliver Gill

BRI­TAIN’S sec­ond-big­gest air­line has warned it may have to “park planes” to pre­serve cash as the Covid cri­sis wreaks havoc on the in­dus­try dur­ing the leaner win­ter months.

Wizz Air also said if on­go­ing travel re­stric­tions con­tinue over the next three months, it will carry on fly­ing at 60pc ca­pac­ity rather than the 80pc pre­vi­ously guided.

De­spite the down­grade, the FTSE 250 air­line, which spe­cialises in low­cost flights to east­ern and cen­tral Europe, re­peated an as­ser­tion that it will be a “struc­tural win­ner” from the Covid cri­sis.

The Gov­ern­ment prompted criti- cism from the in­dus­try as it con­tin­ued to in­tro­duce a quar­an­tine on ar­rivals from coun­tries that are ex­pe­ri­enc­ing an in­crease in in­fec­tion rates.

Re­stric­tions im­posed across Europe, and on Hun­gary in par­tic­u­lar, led to yes­ter­day’s warn­ing.

Hun­gary has closed its bor­ders to all over­seas trav­ellers to keep Covid in­fec­tion rates un­der con­trol.

Wizz said: “Fur­ther ca­pac­ity re­duc­tions re­main a pos­si­bil­ity and as a re­sult, Wizz Air may park parts of its fleet through­out the win­ter sea­son to pro­tect its cash bal­ance.”

Air­line stocks rank among the hard­est hit as a re­sult of the pan­demic.

Wizz, how­ever, has fared com­par­a­tively bet­ter than the likes of IAG, the owner of Bri­tish Air­ways, and low-cost peer easy­Jet.

IAG shares, which have lost two thirds of their value since the start of the year, closed at 202.5p, down more than 6pc on the day, while Wizz stock, which be­gan the year at £38.95, fell nearly 4pc yes­ter­day to end at £37.42.

The travel in­dus­try is wait­ing for an up­date from min­is­ters on a po­ten­tial rein­tro­duc­tion of quar­an­tine rules for Por­tu­gal – just two weeks af­ter they were re­moved.

Wil­lie Walsh, the out­go­ing boss of IAG, added his voice to frus­tra­tion aired by Ste­wart Win­gate, the Gatwick chief, last week over Boris Johnson’s ad­min­is­tra­tion turn­ing re­stric­tions on and off.

Mr Walsh lamented “ever-chang­ing” quar­an­tine re­quire­ments that have led to the UK hang­ing a “closed sign” over its bor­ders.

Mr Win­gate said last week: “A laser­like fo­cus from the Gov­ern­ment on how we make the travel cor­ri­dors more sta­ble such that when we open them up that they re­main open.

“The un­cer­tainty cre­ated by turn­ing them on and off erodes con­sumer con­fi­dence. To build con­fi­dence that if you do go away, you can get back with­out quar­an­tin­ing.”

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