Record losses prompt BA owner to seek vaccine pass
Gatwick Airport and Tui join calls to help reopen borders as travel giants count costs of restrictions
THE owner of British Airways has begged countries to launch a vaccine passport so borders can reopen and foreign holidays are able to restart after it slumped to a record €7.8bn (£6.8bn) loss.
Luis Gallego, head of BA’S parent company IAG, called for immediate action so that his firm could return to the skies.
Meanwhile, Gatwick Airport boss Stewart Wingate said that vaccine passports are “pretty much an inevitability” as his business unveiled a £465m loss for 2020.
Travel titan Tui also joined calls for a passport scheme.
The annual loss at IAG – which owns BA as well as Iberia and Aer Lingus – is the third biggest suffered by a British company during the pandemic.
Only oil titans BP and Shell were hit harder, due to a collapse in prices when normal life ground to a halt.
IAG made a €2.3bn profit for 2019. Early fleet retirements, fuel, and currency hedges and restructuring costs all contributed to the mammoth 2020 loss, the business said, while passenger revenues fell 76pc to €5.5bn.
The FTSE 100 firm expects passenger capacity in the first quarter of this year to be about a fifth of 2019 levels as travel restrictions continue to choke demand, but said the situation remains uncertain. It did not offer any profit guidance for 2021.
Separately, Norwegian Air sank to a record annual loss due to massive writedowns and Covid-related disruption to air travel. The Oslo-based carrier, which is under bankruptcy protection in both Ireland and Norway, posted a net loss of €2.2bn – far worse than the €150m loss for 2019 – after carrying 81pc fewer passengers at 6.87m.
In the fourth quarter, the airline also booked charges of €1.2bn on a planned fleet reduction.
Norwegian aims to cut the number of planes from 140 to 53 and is negotiating terms with lessors. The fleet stood at 131 aircraft at the end of 2020. The company said its examinership process in Ireland and reconstruction process in Norway were on track and expected to end during the second quarter.
It elected to file court proceedings in Ireland as its aircraft are legally held in the country.
Chief executive Jacob Schram said: “We are doing everything we can to emerge as a more financially secure and competitive airline with an improved customer offering. As soon as Europe begins to reopen, we will be ready to welcome more customers on board.”
Norwegian was hit particularly hard by the pandemic as its business model pre-crisis focused on offering cheap transatlantic travel, which has been suspended since the outset of the crisis.
Last month, it announced it would end long-haul services to the US in a move that will lead to about 1,100 job losses in the UK alone at Gatwick.
The company is also trying to secure a significant debt reduction from its creditors as it struggles to stay afloat.