Two US airlines have been told by regulators to keep flying routes that carriers say have little or no demand in order to qualify for federal funding. The DoT Thursday denied most of the requests by JetBlue Airways and Spirit Airlines to reduce or suspend flying in response to collapsing demand amid the coronavirus pandemic. The agency, which is responsible for deciding the amount of flying airlines must maintain to receive govt funds, said both airlines could suspend service to destinations in Puerto Rico, where incoming flights are restricted. The stimulus package passed late last month included US$50b in grants and loans to airlines, with requirements for them to maintain a certain number of flights and destinations, even as passenger numbers fell by 95% or more from pre-pandemic levels. <br/>
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EasyJet said it had enough cash to survive 9 more months of grounding after it secured new loans and made cash savings to boost its reserves to GB3.3b. The carrier, which is in a battle with its biggest shareholder over expansion, also said it expected to take no new aircraft deliveries next year, while its base case for the size of its fleet was reduced by 10% to 302 jets. EasyJet signalled it expected “headline” losses of GBP185m to GBP205m in the first half. While this was an improvement on last year’s GBP275m deficit, the impact of fuel and currency hedging would deliver a reported loss of between GBP360m and BGP380m, the group said. Just hours after EasyJet issued its trading update, founder Stelios Haji-Ioannou called for the removal of its CE and chairman over an order for aircraft with Airbus. <br/>
EasyJet may keep middle seats empty to follow physical distancing rules once coronavirus travel restrictions are lifted, its CE has said. Johan Lundgren said vacant seats were one of the options being explored as the airline started planning for flights to resume, following the grounding of EasyJet’s entire fleet March 30. The CE said a drop in passenger demand would make it easier to keep the middle seats empty when restrictions were eased. However, the middle-seat option has been dismissed by the CE of its rival Ryanair, Michael O’Leary, who said it would be a “hopelessly ineffective” way to keep passengers safe and ultimately unaffordable for airlines. EasyJet said winter bookings were “well ahead” of last year after it released its flight schedule earlier than usual. <br/>
Privately held WestJet Airlines is laying off 1,700 pilots amid travel bans to curb the COVID-19 pandemic, according to a company memo seen by Reuters Thursday. The coronavirus crisis has brought global travel to a virtual standstill, with the steep drop in passenger traffic forcing airlines to cancel several flights or ground fleets. WestJet will lay off 700 pilots effective May 1 and the remaining 1,000 June 1. "We continue to negotiate with the company to protect our members' interests while preserving as many pilot positions as possible," said pilot union Air Line Pilots Association. WestJet said in March that 6,900 of its employees would leave the company, with 90% departing voluntarily. The carrier had about 14,000 employees before the March announcement. <br/>
Virgin Australia has requested for a trading suspension following a trading halt, while it continues to work out funding options. The carrier requested a trading halt April 14, due to end Wednesday morning, to discuss financing and restructuring alternatives. The airline is now requesting a suspension for an additional 7 days or until it makes an announcement, whichever is first. According to Australian Securities Exchange (ASX) listing rules, both trading halts and trading suspensions can be requested on a voluntary basis but the maximum permitted duration of a trading halt is generally 2 trading days. Canberra has yet to directly address whether it will grant the request, and ministers point to relief packages already announced for the country’s aviation sector. <br/>
Stobart Group is considering buying back Irish regional operator Stobart Air and lessor Propius from the administrators of Flybe parent, Connect Airways. Stobart originally sold the Irish regional operator and Propius in Feb 2019 to Connect Airways, a deal related to the creation of Connect Airways by Stobart Group’s aviation division, Virgin Atlantic and Cyrus Airways. Connect Airways went on to acquire the assets of Flybe, but the UK regional carrier was ultimately forced to cease operations earlier this year. “The company confirms that it is reviewing all options in relation to the future of Stobart Air and Propius during this unprecedented time including the possibility of acquiring the businesses from the administrators,” Stobart Group. <br/>
Alaska Air Group, the parent of Alaska Airlines and Horizon Air, will accept US$992m in payroll support and plans to apply for $1.1b in loans to support short-term liquidity under the provisions of the federal CARES Act. The company said it had agreed with the US Treasury Department that $267m of those funds will be provided in the form of a loan that must be repaid. The payroll aid covers 70% of the parent company’s budgeted payroll and benefits costs through Sept 30 as the company endures “a time of near-zero revenue”, Alaska Air Group CE Brad Tilden states. As a condition of the CARES Act, the Treasury will receive the right to buy 847,000 non-voting shares of Alaska Air Group at a price of $31.61 per share, Alaska discloses in a US Securities and Exchange Commission filing. <br/>