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You can find the current article at its original source at https://www.theguardian.com/business/2020/feb/28/easyjet-to-cancel-flights-and-impose-pay-freeze-amid-coronavirus-fears-italy
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| British Airways owner and easyJet warn of coronavirus impact | |
| (32 minutes later) | |
| Emergency measures implemented on back of significant drop in demand | |
| EasyJet and the owner of British Airways have reported significant drops in demand because of the coronavirus outbreak and announced emergency measures, including cancelling flights, changing the size of planes used on routes and freezing pay. | EasyJet and the owner of British Airways have reported significant drops in demand because of the coronavirus outbreak and announced emergency measures, including cancelling flights, changing the size of planes used on routes and freezing pay. |
| The virus has hit ticket sales around the world, wiping tens of billions of dollars off industry revenues, with Asia and Europe particularly affected. EasyJet said on Friday it is cancelling hundreds of flights and imposing a pay freeze as part of a number of emergency cost-cutting measures. | The virus has hit ticket sales around the world, wiping tens of billions of dollars off industry revenues, with Asia and Europe particularly affected. EasyJet said on Friday it is cancelling hundreds of flights and imposing a pay freeze as part of a number of emergency cost-cutting measures. |
| IAG, the owner of BA and Iberia, warned it was suffering from weak passenger demand across both continents, including a drop in business travel globally as companies impose travel restrictions and cancel major industry events. IAG warned its earnings outlook has been “adversely affected” as a result and it could not issue profit guidance for 2020. | IAG, the owner of BA and Iberia, warned it was suffering from weak passenger demand across both continents, including a drop in business travel globally as companies impose travel restrictions and cancel major industry events. IAG warned its earnings outlook has been “adversely affected” as a result and it could not issue profit guidance for 2020. |
| Shares in easyJet, which have fallen by a third this week, and IAG, which has slumped by a quarter since Monday, fell a further 4% and 7.8% respectively on Friday morning. | Shares in easyJet, which have fallen by a third this week, and IAG, which has slumped by a quarter since Monday, fell a further 4% and 7.8% respectively on Friday morning. |
| EasyJet said it would cancel 500 flights on its Italian routes over the last half of March after a spike in coronavirus cases in the country, which has sparked a drop in customer demand. It will mean dropping one in every 10 scheduled flights to Italy. | EasyJet said it would cancel 500 flights on its Italian routes over the last half of March after a spike in coronavirus cases in the country, which has sparked a drop in customer demand. It will mean dropping one in every 10 scheduled flights to Italy. |
| It is also responding to the virus with various cost-cutting measures, including a hiring, promotion and pay freeze, a delay to non-critical spending and cuts to its administrative budget. EasyJet will offer unpaid leave and will stop non-mandatory training to staff. | It is also responding to the virus with various cost-cutting measures, including a hiring, promotion and pay freeze, a delay to non-critical spending and cuts to its administrative budget. EasyJet will offer unpaid leave and will stop non-mandatory training to staff. |
| EasyJet has convened a special committee of senior managers to deal with the problems arising from the Covid-19 outbreak, the airline said. That group, which includes a company doctor, is meeting on a daily basis. The airline said it was also working closely with authorities. | EasyJet has convened a special committee of senior managers to deal with the problems arising from the Covid-19 outbreak, the airline said. That group, which includes a company doctor, is meeting on a daily basis. The airline said it was also working closely with authorities. |
| “Our procedures for dealing with communicable diseases are similar to those developed during the Sars epidemic and other global health emergencies,” the company said. | “Our procedures for dealing with communicable diseases are similar to those developed during the Sars epidemic and other global health emergencies,” the company said. |
| “We have seen a significant softening of demand and load factors into and out of our northern Italian bases,” easyJet said. “Further, we are also seeing some slower demand across our other European markets. As a result, we will be making decisions to cancel some flights, particularly those into and out of Italy.” | “We have seen a significant softening of demand and load factors into and out of our northern Italian bases,” easyJet said. “Further, we are also seeing some slower demand across our other European markets. As a result, we will be making decisions to cancel some flights, particularly those into and out of Italy.” |
| IAG said: “Our operating companies will continue to take mitigating actions to better match supply to demand in line with the evolving situation. Cost and revenue initiatives are being implemented across the business.” | IAG said: “Our operating companies will continue to take mitigating actions to better match supply to demand in line with the evolving situation. Cost and revenue initiatives are being implemented across the business.” |
| The BA and Iberia parent has already suspended flights to mainland China and reduced services for other routes in Asia, including Hong Kong, where it is now only offering one daily flight instead of two. | The BA and Iberia parent has already suspended flights to mainland China and reduced services for other routes in Asia, including Hong Kong, where it is now only offering one daily flight instead of two. |
| Next month it will significantly cut its capacity on Italian routes by cancelling flights and using smaller aircraft, and will take similar action on short-haul flights across the business. By 13 March, IAG will also cut a daily service to the South Korean capital, Seoul, where it will now only fly three to four times a week. | Next month it will significantly cut its capacity on Italian routes by cancelling flights and using smaller aircraft, and will take similar action on short-haul flights across the business. By 13 March, IAG will also cut a daily service to the South Korean capital, Seoul, where it will now only fly three to four times a week. |
| IAG, which also owns the Aer Lingus and Vueling airlines, said it will boost the number of flights on some of BA’s long-haul routes where there is greater demand, including India, South Africa and the US. Iberia is also focus on increasing capacity on US and domestic routes. | IAG, which also owns the Aer Lingus and Vueling airlines, said it will boost the number of flights on some of BA’s long-haul routes where there is greater demand, including India, South Africa and the US. Iberia is also focus on increasing capacity on US and domestic routes. |
| The update was released as part of IAG’s full-year results, which showed a 34% drop in pre-tax profits to €2.3bn (£2bn) despite a 5% rise in revenue to €22bn (£18.8bn). | The update was released as part of IAG’s full-year results, which showed a 34% drop in pre-tax profits to €2.3bn (£2bn) despite a 5% rise in revenue to €22bn (£18.8bn). |