US airlines could burn US$40b in cash if demand vanishes
US airlines could burn through US$40b in cash by year-end if passenger revenue plunges to nothing for the rest of 2020 because of the new coronavirus and operations are shut down, according to Vertical Research Partnership. “This is a dramatization, but isn’t far from the new reality as each capacity reduction far exceeds the one that preceded it,” Vertical Research analyst Darryl Genovesi said Thursday. His “no-longer-so-extreme” scenario also assumes that bookings dry up and carriers are forced to refund all advance ticket purchases. Genovesi expects that carriers focused on the domestic market, which so far have cut about 20% of available seats in the next few weeks will slash capacity more along the lines of 70%. Passenger revenue could hit zero by the end of this quarter. <br/>
https://portal.staralliance.com/cms/news/hot-topics/2020-03-20/general/us-airlines-could-burn-us-40b-in-cash-if-demand-vanishes
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US airlines could burn US$40b in cash if demand vanishes
US airlines could burn through US$40b in cash by year-end if passenger revenue plunges to nothing for the rest of 2020 because of the new coronavirus and operations are shut down, according to Vertical Research Partnership. “This is a dramatization, but isn’t far from the new reality as each capacity reduction far exceeds the one that preceded it,” Vertical Research analyst Darryl Genovesi said Thursday. His “no-longer-so-extreme” scenario also assumes that bookings dry up and carriers are forced to refund all advance ticket purchases. Genovesi expects that carriers focused on the domestic market, which so far have cut about 20% of available seats in the next few weeks will slash capacity more along the lines of 70%. Passenger revenue could hit zero by the end of this quarter. <br/>
