LONDON (Reuters) – British Airways owner IAG has exhausted every avenue to shore up its finances and is burning through cash, its CEO said on Monday, as the aviation industry warned of the fresh damage it would suffer if Britain quarantines international arrivals.
Willie Walsh told parliament’s transport committee IAG would have to review plans to resume flying in July if the government pressed ahead with plans to introduce a quarantine on most people coming into the country by air as part of measures to prevent a second peak of the coronavirus pandemic.
While Walsh said IAG was not in a position where it had to ask for a specific bailout from the government, he added the quarantine plan would add to the pressure on the group.
“We’ve probably exhausted every avenue that I can think of at this stage to shore up our liquidity. The cash has been reducing significantly and that will be the case as we go through May, June and July,” he said.
“The announcements yesterday of a 14-day period (of quarantine) for coming into the UK, it’s definitely going to make it worse.”
Britain’s aviation industry is already facing a battle to survive, with most flights grounded since March due to travel restrictions to contain the pandemic.
It urged the government on Monday to come up with an alternative to its quarantine plan, warning the proposal could destroy any hopes of a swift recovery for the sector.
Heathrow Airport, which during normal times is Europe’s busiest airport but which saw passenger numbers plunge 97% in April, called for common international standards to enable passengers to travel freely between low risk counties once the virus is under control.
That would allow borders to be re-opened, it said.
Meanwhile, budget airline easyJet said any quarantine requirements must be short-lived and replaced by a targeted regime allowing low-risk passengers to travel easily.
CALLS FOR CLARITY
Airlines UK, which represents British Airways, easyJet and other UK carriers, said quarantine measures would lead to the industry requiring additional government support.
The industry body has already asked for Britain’s job retention scheme to be extended beyond June, and requested a temporary suspension of some taxes airlines pay, such as air passenger duty.
Bosses complained there was lack of clarity over how long the new rules would last and how often they would be reviewed.
“It’s inevitable that consumers will be confused by the message, they will not be certain as to when they should book their holidays,” Manchester Airports Group Chief Executive Charlie Cornish told BBC television.
Some destinations will be at an advantage, as travellers from France will be exempt from the quarantine rules, while airlines said the new rules wouldn’t be applied to arrivals from Ireland.
Britain’s foreign minister Dominic Raab told BBC Radio there would be exemptions from the rules but did not give details. He said the government was aiming to bring in the quarantine from the end of the month.
Critics have asked why it was not brought in sooner and how it will be put into practise, given passengers could fly to France and then cross into Britain via ferry or train.
Reporting by Sarah Young; editing by James Davey and Mark Potter
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