Sir Richard Branson’s Virgin Group has committed GBP200m of immediate funding for Virgin Atlantic as the grounded airline races to secure a GBP1b rescue package early this month. The commitment will help bolster the struggling airline’s cash reserves in the coming months in the face of a slow recovery in international air travel that has been decimated by the coronavirus pandemic. While Virgin Group is planning to provide about GBP200m in cash now, according to people close to the process, additional shareholder support of about GBP400m has also been committed. This will come from Delta, which has a 49% stake in the airline, as well as Virgin Group — the majority shareholder with a 51% holding. The GBP400m is likely to be in the form of deferred payments such as brand fees and shared IT and back-office platforms. The deal will be structured to ensure no change in Virgin Atlantic’s current shareholding. The cash injection comes as Virgin Atlantic is attempting to finalise a multipronged refinancing package of about GBP1b. On top of the GBP600m from existing shareholders, another key part of the airline’s rescue package is expected to come from private investors, who will provide about GBP250m in debt funding. <br/>
unaligned
To discourage passengers from disobeying a rule to wear masks during flights, Alaska Airlines will issue final warnings to offending customers: a yellow card. Starting in July, flight attendants on Alaska flights will hand out formal notices to passengers who refuse to wear a face covering. The card comes with the threat of further sanctions, the company said. Upon review, Alaska could ban passengers who refuse to wear a mask for a period of time. The policy comes after flight crews had to deal with some passengers who flagrantly disregarded the mask mandate, prompting the company to create the formal warning system, Alaska said Tuesday. Like other carriers, Alaska does list a few exemptions to the mask mandate: Children younger than 2, passengers with medical problems and passengers with disabilities that prevent wearing a face covering. Customers are permitted to temporarily remove their masks to eat or drink, the airline said. Before passengers board Alaska flights, they will also be asked to sign a required health agreement and agree to abide by the mask policy.<br/>
After three months of encouraging tourists to stay away from Hawaii, the state will begin easing its mandatory quarantine on August 1. "Now is the time to work together as a community to ensure that our residents and local businesses can safely return to a larger volume of travellers," Gov. David Ige said. Hawaiian Airlines said Wednesday it will add hundreds of weekly flights to its schedule between Hawaii and the US mainland as the state government eases a strict quarantine. The restrictions have mandated a 14-day quarantine for nearly all travellers in and out of the state, as well as for travel among the state's islands. Those rules made travel into the state "almost nonexistent" since April, according to a major airline industry group. Starting August 1, the state will allow travellers to avoid the quarantine as long as they can show that they've tested negative for Covid-19 within 72 hours of their arrival. The state said it will not provide testing for passengers at the airport, and travelers will still be required to undergo temperature checks. As the new state policy rolls out, the airline will resume regular service between Hawaii and several non-west coast cities, including Boston, Las Vegas, New York and Phoenix, as well as Oakland, San Francisco and San Jose. The airline is also adding service this month between the islands and Portland, San Diego and Sacramento.<br/>
JetBlue agreed not to furlough any pilots involuntarily until May 1 in exchange for unspecified contract concessions designed to help the carrier cut operating expenses. The deal doesn’t include changes to pay rates or significant modifications in work rules, the JetBlue unit of the Air Line Pilots Association said Wednesday in a letter to members. The union said it couldn’t yet disclose short-term changes in portions of its contract from October through April, which will return to normal earlier “if demand for flying recovers.” Carriers worldwide have been slashing costs and reducing flight operations in response to the near disappearance of demand in late March and April as the Covid-19 pandemic spread and governments imposed travel restrictions. Many airlines are trying to avoid furloughs by offering leave, early retirement and voluntary separation programs. The union promised to provide additional details to members in coming weeks.<br/>
El Al has reiterated that a financial support scheme is critical to the airline’s survival, as it disclosed a net Q1 loss of nearly $140m. El Al says financial assistance is “essential” to its being able to deal with the coronavirus crisis. At the end of Q1, on 31 March, the company’s current assets totalled $324m, down by $162m, while its current liabilities had risen by $1.1b to nearly $2.2b. El Al attributes this sharp increase – and the consequent trebling of working-capital deficit – to a requirement that, owing to the company’s situation, certain loans be classified as short-term liabilities. Its non-current assets stood at $3.06b while non-current liabilities reached $1.27b, leaving the company in overall negative equity. “There are significant doubts about the company’s continued existence as a going concern,” it warns. El Al has also had to cope with the impact of deteriorating aircraft values, because conditions attached to certain loans require a minimum ratio to be maintained between the value of aircraft and the loans secured on them. Non-compliance would give the lending banks the right to a $30m payment, but the airline has obtained a waiver from the ratio requirement.<br/>
Ryanair pilots have agreed to take a 20% pay cut as part of efforts to avoid up to 3,000 job cuts at Europe’s biggest budget airline. The pilots’ union Balpa announced on Wednesday that 96% of its Ryanair members had voted to accept the temporary pay cut in order to “save jobs that were under threat” due to the collapse in demand for flights in the face of the coronavirus pandemic. “This is a terrible time for aviation and for employees in all airlines,” Brian Strutton, Balpa’s general secretary said. “It was our members’ mandate for us to save as many jobs as possible. In the circumstances this is the right thing to do even if it means accepting difficult temporary reductions in pay.” The pilots agreed to the pay cut deal hours after Ryanair’s CE Michael O’Leary made public an ultimatum that a total of 3,000 job losses could only be avoided if all staff agreed to pay cuts. The deal with Ryanair’s pilots saves 260 jobs that were at risk. Ryanair had said a total of 330 pilot jobs were at risk. Negotiations with cabin crew and other staff continue, lower paid cabin crew have been asked to sacrifice 5% of their pay.<br/>
Ryanair, one of the largest customers for Boeing’s troubled 737 MAX, hopes to take its first delivery in November after the jet’s first test flight appeared to go well, Group CE Michael O’Leary said Wednesday. Boeing this week began a series of long-delayed flight tests of its redesigned 737 MAX with regulators at the controls after the second of two fatal crashes grounded the jet worldwide in early 2019. “The first test flight was on Tuesday, that seems to have gone well and if that keeps on track then at least we hope to be welcoming our first 30-40 for summer 2021 and that would enable us to restart growth,” O’Leary said. Ryanair has 210 737 MAX jets on order and is in talks with Boeing over compensation for delays to deliveries, which were due to start last year. “Subject to the MAX being certified to return to service in North America, we would hope to be getting our first deliveries in November. This side of Christmas,” O’Leary said.<br/>
EasyJet plans to cut jobs and the number of aircraft it has in Berlin and is proposing scrapping domestic German flights as part of its retrenchment over COVID-19, a German union and source familiar with the plan said. Airlines around Europe have set out plans to cut tens of thousands of jobs as bosses believe it will take several years for demand to return to the levels seen in 2019. EasyJet set out its plan to reduce British pilot numbers on Tuesday and on Wednesday it confirmed it had launched a consultation in Germany to reduce its presence in Berlin. It said in May it needed to cut 4,500 jobs in total to stay competitive. While the airline said it remained committed to Berlin, union Verdi said easyJet intended to withdraw from domestic travel and reduce the number of aircraft stationed in the German capital to 18 from 34, and halve the number of employees from around 1,540. "Unfortunately the lower demand environment means we need fewer aircraft and have less opportunity for work for our people - we are committed to working constructively with our employee representatives across the network," CE Johan Lundgren said.<br/>
A German court on Wednesday rejected demands for higher compensation from Lufthansa by eight people who lost loved ones in the deliberate crash of a plane operated by its budget airline Germanwings five years ago. French and German investigators have concluded that co-pilot Andreas Lubitz intentionally crashed the Airbus A320 he was co-piloting into a French mountainside on March 24, 2015, killing all 150 people on board flight 9525 from Barcelona to Duesseldorf. News agency dpa said the state court in the western German city of Essen rejected the plaintiffs’ case for a higher payout than originally offered, as judges found that Lufthansa and its US-based flight school weren’t responsible for determining whether Lubitz was fit to fly. The plaintiffs had argued that they allowed him to complete his training despite evidence of mental illness. Judge Lars Theissen said aviation safety is “a state task.”<br/>
China's aviation authority said Wednesday it would suspend Sichuan Airlines from operating the Cairo-Chengdu route for a week from July 6, after six arriving passengers tested positive for the novel coronavirus. Last month, a China Southern Airlines flight from Dhaka to Guangzhou was suspended for four weeks over concerns about imported infections.<br/>
The EU’s announcement that Pakistan International Airlines would be barred from flying into Europe for at least six months is the latest blow to the country’s national flag carrier, which has been mired in financial and administrative troubles and has come under scrutiny after a crash in May that killed 97 people. The decision on Tuesday by the EASA to temporarily ban PIA followed revelations last month by the Pakistani aviation minister, Ghulam Sarwar Khan, that a large number of pilots there and at other airlines had dubious credentials. The reports of the questionable credentials have put Pakistani pilots under international scrutiny. Earlier this week, Vietnam grounded 27 Pakistani pilots who fly for Vietnamese airlines. The United Arab Emirates has also sought verification of the credentials of Pakistani airline employees. The European air safety agency said the airline “is currently not capable to certify and oversee its operators and aircraft in accordance with applicable international standards.” The airline has long been criticized as being overstaffed, has a reputation for lax quality control, and many appointments are seen as a result of political pressure or nepotism. Repeated efforts by successive governments to make it financially viable have failed, and it is running into a loss of around 6b rupees, or about $36m, per month, officials say. Pakistani officials have described its financial situation as a “bottomless pit.”<br/>
The United Arab Emirates is seeking to verify the credentials of the Pakistani pilots and engineers employed in its airlines after the South Asian government grounded 262 pilots for holding "dubious" qualifications. Pakistan grounded the pilots on June 26 on suspicion that they allegedly falsified their examinations to qualify for flying aircraft, leading to them having licenses the country's aviation minister termed "dubious. A total of 262 of the country's 860 pilots were affected, including 141 of PIA pilots. The DG of the UAE's General Civil Aviation Authority Saif Mohammed Al Suwaidi requested the verification of the credentials of Pakistani pilots, aircraft maintenance engineers, and flight operations officers working in the Middle Eastern country in a June 29 letter to the Director General of the Pakistan Civil Aviation Authority Hassan Nasir Jamy. "We would like to request your good offices to verify the licensing credentials of the attached pilots list who are currently holding UAE's pilots licences based on licences and qualifications issued by Pakistan Civil Aviation Authority," the letter said.<br/>