Norway’s govt is providing a conditional state loan guarantee for its aviation industry amounting to NKr6b (US$533m), and is securing a minimum level of flight operations in the country. Half of the funding, NKr3b, will be directed at embattled Norwegian, with another NKr1.5b for SAS. The remaining NKr1.5b will be split between Wideroe and other carriers. The scheme will be arranged through the export credit institute GIEK, with the Norwegian govt providing 90% of the guarantee and external parties the remaining 10%. Conditions are being attached to the guarantees, including a minimum 8% equity requirement. While SAS and Wideroe meet this equity criterion, Norwegian will only be provided with an initial NKr300m until it achieves a reduction in interest and repayments to creditors. <br/>
unaligned
Spirit Airlines will cut its April capacity by 20% and its May capacity by 25% and reduce executive salaries as carrier seeks to reduce costs in response to the coronavirus pandemic. Load factors are expected to continue declining through March as govts limit air travel in attempt to halt the spread of the virus, Spirit CE Ted Christie says in a March 17 US Securities and Exchange Commission filing. “So far, 10 countries we serve have required airlines to limit or completely stop operations,” Christie says. “As leisure events are cancelled across [the US], our flown load factor has dropped dramatically over the last week and currently sits about 25% lower than last year.” The carrier has reduced fares “but it isn’t enough” to maintain volume, he says. <br/>
Compass Airlines, which flies regional routes for American Airlines as American Eagle out of its Los Angeles hub, will shut down completely April 7, the second US regional carrier to fall victim to the coronavirus, according to a letter employees say they received. The airline, owned by Trans States Holdings, said Tuesday that another of its subsidiaries, Trans States Airlines, a regional carrier for United Airlines, would also shutter operations April 1. “Demand has diminished to a point that American has made the decision to remove a large majority of American Eagle flights in Los Angeles starting April 7, which will effectively eliminate all our remaining flying with the start of the April 7 schedule,” CE Rick Leach wrote in a memo to employees March 19. <br/>