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The parent company of British Airways reeled to a loss of E3.8b in the first six months of the year as travel restrictions from the COVID-19 pandemic ate into the bottom line. By way of comparison, IAG reported E806m in profit in the same period a year ago. Passenger traffic dropped by 98.4% in the second quarter amid government travel restrictions. CE Willie Walsh predicted that passenger levels wouldn’t return to pre-virus levels until 2023, and that it is “restructuring its cost base to reduce each airline’s size.” Walsh says the scale of the challenge eclipses the downturn faced by the industry after the Sept.11, 2001 attacks. “Anyone who believes that this is just a temporary downturn and therefore can be fixed with temporary measures, I’m afraid seriously misjudges what the industry is going through,'' he said.<br/>

BA owner International Airlines Group has launched a E2.75b emergency fundraising, supported by its biggest shareholder Qatar Airways, to see it through the Covid-19 pandemic that has thrust the industry into a historic crisis.  The group confirmed the rights issue, which it said it was considering last week, as it unveiled a Q2 loss for the three months to the end of June of more than E2b after its passenger business collapsed. Willie Walsh, CE at IAG, said the airline group had lost more in this quarter than it had ever lost in a year and was “facing an unprecedented crisis”.  “Anybody who thinks these are short-term issues and challenges that can be resolved by short-term measures, I think fails to understand the scale of the challenge,” he said. The news drove IAG shares down 7% to 168p — their lowest since 2012 — by Friday afternoon. The stock has lost about 60% of its value in the past 12 months. The slower recovery faced by network carriers such as IAG was highlighted by the group downgrading its passenger capacity outlook for the peak summer months — July, August and September — to just 26 % of last year’s levels, compared with its previous plan to fly about 45%.<br/>

Qatar Airways has promised to pump hundreds of millions of dollars into BA and Iberia as they fight to survive the coronavirus pandemic. International Airlines Group (ICAGY), which owns both European carriers said Friday that it plans to raise as much as E2.75b from shareholders, including Qatar's state-owned airline, to help weather the deepest crisis in aviation history.<br/>The company plans to use the money to pay down debt and increase the amount of cash it holds, as it prepares for several years of depressed demand.<br/>The aviation industry has been decimated by the pandemic and IAG does not expect global passenger demand to return to 2019 levels before at least 2023. British Airways has already announced plans to cut up to 12,000 jobs, more than a quarter of its workforce, and is retiring its entire fleet of Boeing 747s four years ahead of schedule. "Our industry is facing an unprecedented crisis and the outlook remains uncertain," CEO Willie Walsh said. "However, we strongly believe that now is the time to look to the future and strengthen IAG's financial and strategic position," he added. Qatar Airways is the group's largest shareholder with a 25.1% stake. IAG said Qatar would support the capital increase, implying it will provide nearly E688m in new funds. "Qatar Airways ... has confirmed its support for the proposed capital increase and irrevocably undertaken to subscribe for its pro rata entitlement," IAG said. Qatar is seeking two seats on the board. Shareholders will vote on the appointments and the capital increase in September.<br/>

British Airways pilots have overwhelmingly voted to accept a deal cutting wages by 20% with 270 jobs lost, according to aviation union BALPA. The deal, announced Friday, comes as the airline struggles with the economic impact of the coronavirus which has seen it propose lay-offs of 12,000 staff, more than 1,200 of those pilots. Salaries will initially be reduced by 20 percent, then by eight percent over two years, after which there will be no more wage cuts, said BALPA. It also prevents, said the union, an unpopular "fire and rehire" scheme where staff would have been handed new contracts on different conditions and which had led to strike threats. "Our members have made a pragmatic decision in the circumstances but the fact that we were unable to persuade BA to avoid all compulsory redundancies is bitterly disappointing," said BALPA general secretary Brian Strutton. British Airways employs 4,300 pilots. The deal was backed by 85% of pilots, said BALPA, and the turnout was 87%.<br/>

British Airways-owner IAG named Javier Ferran as its new chairman on Friday, due to take over at the beginning of next year, just months after a new chief executive takes the reins and as the pandemic batters the travel market. Ferran, who is also chairman of the world's largest spirits maker Diageo, has been on the IAG board since 2019 and will replace Antonio Vazquez. Ferran said that the airline group, which posted a record loss on Friday and said it planned to raise E2.75b from shareholders to get through the crisis, had a strong future. "I am committed to leading the group through this crisisand working with Luis (Gallego) to build a strong future, in which the group will continue to take a leading role in the industry," Ferran said Friday. By the time he steps down at the end of this year, chairman Vazquez will have been at the helm for almost ten years with his tenure dating back to the formation of IAG in 2011 through the merger of British Airways and Iberia.<br/>

Cathay Pacific said it will offer a voluntary scheme to its Hong Kong-based pilots who are approaching retirement age to leave the group early, in a continued effort to cut costs amid the coronavirus pandemic. The airline said Saturday that it is looking at different ways to reduce costs in the medium term, given reduced passenger demand with no immediate signs of improvement. The retirement plan was first reported in local media. Cathay Pacific has already taken short-term measures including executive pay cuts and two rounds of voluntary special leave scheme. Pilots aged 50 or 55 and above, depending on the retirement age outlined in their contract as 55 or 65 respectively, are eligible to apply for the early retirement scheme, the carrier said. Pilots aged 58 and above at its regional arm Cathay Dragon are also eligible. "The decision comes after careful consideration and is an effective way for the Group to manage costs. Addressing a specific group of employees for this dedicated scheme helps us adjust to the new operating environment," the carrier said. The scheme will pay pilots who retire early three months basic salary for each year remaining before their normal retirement age, plus a further one month allowance payment up to a maximum of 12 months' basic salary. Cathay Pacific said management is doing a comprehensive review of all aspects of the group's operations, and it will make recommendations to the board on the future size and shape of the airline by Q4.<br/>

LATAM Airlines will fire "at least" 2,700 workers in Brazil, including pilots, its Brazilian arm said on Saturday, as the bankrupt carrier struggles to cut costs and cope with an industry collapse due to the COVID-19 pandemic. LATAM Brasil said it opened a voluntary redundancy process on Friday which will run through Aug. 4, after which a further minimum 2,700 jobs will be cut. The announcement followed the breakdown in talks with the SNA union over workers' pay, the statement said. LATAM said it pays its pilots and crew more than its rivals in Brazil, and the pandemic has forced it to "match industry practices." The layoffs are the latest in efforts to downsize Latin America's largest airline. <br/>