The airline is taking full advantage of the UK government's job retention scheme, but with 500 planes out of action, the blow to the economy will be felt.
EasyJet has grounded its fleet of 498 aircraft after completing the last of its rescue flights, placing cabin crew on 80 percent salary.
“At this stage there can be no certainty of the date for restarting commercial flights. We will continuously evaluate the situation based on regulations and demand, and will update the market when we have a view,” the airline said.
It has carried out 650 flights to repatriate 45,000 customers, with the last rescue mission completed yesterday ( 29 March). However, the carrier is not ruling out more crisis-related operations: “We will continue to work with government bodies to operate additional rescue flights as requested,” EasyJet also said in its fleet grounding update.
Rescue flights are being deployed to return citizens to their countries during the pandemic.
‘Strong business model’
The fleet decision follows last month’s call for government aid, but easyJet has reiterated it has a strong balance sheet, with no debt re-financings due until 2022. “We are in ongoing discussions with liquidity providers who recognize our strength of balance sheet and business model,” it said. “We continue to take every action to remove cost and non-critical expenditure from the business at every level in order to help mitigate the impact from the coronavirus. The grounding of aircraft removes significant cost.”
However, the airline has agreed furlough arrangements with the Unite union which will see cabin crew paid 80 percent of their average pay, in line with the UK government’s job retention scheme. This begins 1 April and will initially last two months.
Johan Lundgren, EasyJet CEO, said: “I am extremely proud of the way in which people across EasyJet have given their absolute best at such a challenging time, including so many crew who have volunteered to operate rescue flights to bring our customers home. We are working tirelessly to ensure that EasyJet continues to be well positioned to overcome the challenges of coronavirus.”
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Photo Credit: EasyJet will ground nearly 500 planes as a result of the crisis Christopher Jasper / Bloomberg