Virgin Atlantic to seek coronavirus taxpayer bailout next week

Tom McArthur
Page editor
Virgin Atlantic and Jet 2 planes at Glasgow Airport after Prime Minister Boris Johnson has put the UK in lockdown to help curb the spread of the coronavirus. (Photo by Andrew Milligan/PA Images via Getty Images)

Struggling Virgin Atlantic is set to ask the government for hundreds of millions of pounds of taxpayers money to help it stay afloat during the ongoing coronavirus pandemic.

Requests for state help are expected from several other airlines, but Virgin Atlantic led the calls for aid two weeks ago as bookings fell away to almost zero.

But UK chancellor Rishi Sunak has told the struggling aviation industry he will only assist firms on a case-by-case basis.

Almost all staff at Virgin Atlantic have accepted unpaid leave and Sir Richard Branson has said he will inject $250m of his own fortune into the Virgin group, including the Virgin Voyages cruise line, the Guardian reports.

The airline is entirely long haul and passenger focussed, which means travel bans in recent weeks have hit the carrier hard.

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The government could buy into UK airlines struggling due to the collapse in demand for air travel, Transport Secretary Grant Shapps has indicated.

Mr Shapps told MPs that nothing had been ruled out in the response to the coronavirus outbreak, according to a summary of a Transport Select Committee hearing published on Friday.

During the session, which was held in private over Skype, Labour MP Ruth Cadbury asked the Cabinet minister whether the Government would consider taking a stake in UK airlines that faced collapse.

The description of Mr Shapps's response states: "The Secretary of State said that everything was on the table.

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"The department had to try to save the aviation sector and to protect the consumer and the taxpayer.

"It was important to save companies that should survive in normal times."

The vast bulk of flights to and from the UK have been grounded amid the coronavirus pandemic.

Some airlines like British Airways are still operating a number of rescue flights to bring stranded Brits home.

Industry group the International Air Transport Association warned of an "apocalypse" in the aviation sector as it called on governments around the world for help.