Credit Suisse is forecasting that Lufthansa will make an operating loss of E1.5b (US$1.7b) this year, and is advocating a move toward leasing aircraft as a means of improving the group’s cash position. The bank had previously predicted an adjusted EBIT of E2.2b. Lufthansa Group made operating profit of E2.03b last year. But the group disclosed March 13 that it would not pay shareholders a dividend in an effort to preserve cash amid the coronavirus crisis. The group intends to cancel up to 70% of its schedule over “the next few weeks”, reduce working hours for staff and postpone planned investments. Its subsidiary Austrian Airlines will terminate all regular flights March 19 “until further notice”. Nonetheless, the bank describes Lufthansa as “one of the strongest players in the industry”. <br/>
star
Air NZ has triggered a self-imposed trading halt from Monday to allow itself “more time to more fully assess the operational and financial impacts of global travel restrictions”. It does not state when this will be lifted. The airline says: “As a result of the downturn in travel Air NZ continues to review its cost base and will need to start the process of redundancies for permanent positions[,] acknowledging the important role partnering with unions has in this process.” CE Greg Foran says: “We are now accepting that for the coming months at least Air NZ will be a smaller airline requiring fewer resources, including people." Foran adds that the airline is “working constructively” with the 4 main unions “to ensure the right outcome for all staff”. These are E tu, AMEA, NZALPA and Federation of Air NZ Pilots. <br/>
Air Canada is retracting financial guidance and cutting operations as the global coronavirus pandemic hits airlines, while asking the Canadian govt to help with financial losses it expects to suffer in the coming months. “The crisis facing our industry is worsening as countries around the world adopt increasingly severe measures, national lockdowns and travel restrictions,” writes CE Colin Rovinescu Monday. “We understand that the govts of the US and many European countries...have approved or are considering assistance for their airline industries in one form or another. Under these circumstances, we believe that the Canadian airline industry should also see similar assistance,” he says. <br/>
United Airlines has asked union leaders to support an effort to secure “govt assistance”, a move coming in response to tumbling demand as the coronavirus engulfs the industry. The “call to action for govt assistance” will come later this week, United’s Master Executive Council (MEC), which represents the company’s 13,000 pilots, says in a letter to members Sunday. The letter says that during a March 15 call with leaders from several unions, United CE Oscar Munoz and president Scott Kirby “asked for labour’s help”. “As we do not know the duration of this event, temporarily reducing cash burn over the short-term is critical,” Todd Insler, a United captain and chairman of the MEC, writes in the letter. <br/>