Coronavirus: Airlines are burning through cash at £400,000 per minute
The Independent has analysed figures from the International Air Traffic Association (Iata) and can reveal that airlines are collectively losing cash at £400,000 per minute, based on the fall in cash reserves per week.
In the time it takes today’s sole British Airways departure from London to Los Angeles to reach California, the world’s airlines will have lost a quarter of a billion pounds.
Before the coronavirus pandemic, BA had planned to dispatch three wide-bodied jets on the route from Heathrow to LAX today. The two Boeing 747s and one Airbus A380 would have carried around 1,000 people between them.
Instead, like other airlines, British Airways has seen its passenger numbers collapse.
Today’s service between the UK and the US west coast is flown by a Boeing 787 with just 214 seats. The 11-hour, 10-minute journey is set to lose the airline yet more cash.
The London-Los Angeles link is running as part of a skeleton service on a few key routes, for the benefit of essential workers, important family or business journeys and travellers trying to get home; some US-government organised rescue flights are operating from Europe and elsewhere to Heathrow because London has the best remaining transatlantic connections.
For today’s flight, a late-booking passenger would expect to pay around £1,750 one way – but BA is charging a low one-way fare of £633, which is unprecedented in the 21st century.
IAG, the parent company of British Airways, has cut capacity by 90 per cent in April and May; agreed that its 4,000 pilots will take four weeks of unpaid leave in April and May; and furloughed 30,000 cabin crew and ground-based staff.
Most of the BA fleet is in storage, at locations including Cardiff, Bournemouth, Chateauroux in France and Teruel in Spain.
But the airline must keep paying the aircraft leases – which even on the narrow-bodied Airbus A320 can amount to £250,000 per month.
This pattern is being repeated around the world.
An announcement on Tuesday evening by the German national airline, Lufthansa, indicated pessimism about the future: “It will take several months until the global travel restrictions are completely lifted and years until the worldwide demand for air travel returns to pre-crisis levels.”
“Lufthansa will be reducing capacity at its hubs in Frankfurt and Munich.
The carrier is to permanently ground more than 20 wide-bodied jets.
Many aircraft are expected to be flown to locations such as Lourdes in France and Victorville in California to be stripped for parts.
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