EasyJet today called on the government for a temporary removal of Air Passenger Duty “to support the recovery of UK aviation” due to the impact of Covid-19.
The plea came as the UK budget carrier recorded a loss of almost £325 million in the last quarter following the grounding of its fleet on March 30 and started consultation on cutting almost a third of its workforce.
EasyJet said: “The pandemic is having an unprecedented impact on the aviation sector.
“It is one of the worst hit industries, and government action is needed across Europe to retain connectivity and a viable airline infrastructure.
“Without this we risk long term damage to the recovery. This would significantly quicken the reintroduction and growth of the number of flights and routes available in the UK, particularly outside London.”
EasyJet expects to record a smaller loss in the current quarter than the three months to June 30.
But the airline added: “At this stage, given the continued level of short-term uncertainty, it would not be appropriate to provide any other financial guidance for the remainder of the 2020 financial year.”
The airline has raised more than £2.2 billion since the beginning of the pandemic, including £600 million from the government’s Covid Corporate Financing Facility, £400 million from drawing down a revolving credit facility, £400 million from two term loans, £405 million in proceeds from sale and leaseback transactions and £419 million from a share placing.
Flights re-started on June 15 and easyJet flew just 117,000 passengers with a total capacity of 132,000 seats in the remaining two weeks of the quarter. This compared with 26.3 million passengers carried in the equivalent three months last year.
The initial schedule comprised only ten routes and delivered a load factor of 88.9%.
The airline said: “We have now completed more than one month of restart operations and are seeing encouraging performance across the network with a continued focus to undertake only profitable flying.
“In July easyJet flew just over 2 million passengers with a load factor of 84%.”
The airline is cutting its workforce by up to 30% as part of a previously announced major restructuring to “drive down costs in all areas of the business which is a necessity in the current Covid-19 environment”.
An employee consultation process has started on proposals to reduce staff numbers, “as well as optimising our network and bases, improving productivity and promoting more efficient ways of working”.
EasyJet added: “We are fully committed to work closely and constructively with our employee representatives during these consultations.”
The airline expects to fly around 40% of planned capacity in the current summer quarter, peaking in August, compared to 30% previously estimated.
EasyJet “will act quickly to selectively acquire attractive slots made available in locations where the opportunity arises”.
The airline added: “Our late summer bookings are performing well, with beach destinations such as Faro and Nice proving popular, as well as city destinations like Amsterdam and Paris, reflecting our customers’ interest in getting away for a summer holiday or city break.”
Chief executive Johan Lundgren said: “I am really encouraged that we have seen higher than expected levels of demand with load factor of 84% in July with destinations like Faro and Nice remaining popular with customers.
“Our bookings for the remainder of the summer are performing better than expected and as a result we have decided to expand our schedule over the fourth quarter to fly c.40% of capacity.
“This increased flying will allow us to connect even more customers to family or friends and to take the breaks they have worked hard for.
“Despite the challenge we continue to face due to the pandemic, we remain no less committed to fulfilling our customers’ desire to fly sustainably through our carbon reduction initiatives, including offsetting on behalf of our customers.
“As we look ahead, I am confident that easyJet will continue to serve our customers well, delivering our renowned friendly service and value across our unrivalled network.”
EasyJet claimed overall customer satisfaction hitting a high of 80% since the restart, a 13 percentage point increase compared to the same period last year, “driven by operational performance and the management of Covid-19 policies”.
Customer satisfaction in July rose by double digits in every major market, with “extremely strong” improvements in overall customer satisfaction in Portugal, the Netherlands, the UK and Switzerland.
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