BA and easyJet to cut European flights as COVID-19 outbreak hits demand

British Airways and easyJet are cutting flights and cutting costs after suffering a drop in demand for European flights.

EasyJet said following the increased incidence of COVID-19 cases in Northern Italy, there has been a ‘significant softening’ of demand and load factors into and out of its Northern Italian bases.

Alongside flight reductions it is imposing a recruitment and pay freeze.

"We will be making decisions to cancel some flights, particularly those into and out of Italy, while continuing to monitor the situation and adapting our flying programme to support demand," it said today.

"While it is too early to determine what the impact of the COVID-19 outbreak will be on current year outlook and guidance for both the airline and holidays business, we continue to monitor the situation carefully and will update the market in due course."

It said a cross-functional working group that has been meeting daily to make sure all its processes and policies remain effective.

It said it would be focusing on cost savings across the business, including budget cuts in administrative areas and discretionary spend, recruitment, promotion and pay freezes across the network and postponement of non-critical project and capital expenditure.

It will also be offering unpaid leave and halting non-mandatory training, working with third party suppliers to further reduce cost, and re-allocating aircraft for summer 2020.

Meanwhile, BA parent IAG said it was experiencing demand weakness on both Asian and European routes and a weakening of business travel across due to the cancellation of industry events and corporate travel restrictions. 

Flights to Mainland China have been suspended and some services on other Asian routes have been reduced, including Hong Kong. 

From March 13, it will reduce its daily service to Seoul to 3-4 times weekly. 

"Some of the freed-up longhaul capacity is being redeployed to routes with stronger demand," it said.

"British Airways has announced additional flights to India, South Africa and the US, while Iberia is increasing capacity on US and domestic routes." 

In Europe, capacity on Italian routes for March has been significantly reduced through a combination of cancellations.

"We have a management team experienced in similar situations and have demonstrated that we can respond quickly to changing market conditions. We are strongly positioned for the expected recovery in demand," it said.

But IAG warned: "Given the ongoing uncertainty on the potential impact and duration of COVID-19, it is not possible to give accurate profit guidance for FY 2020 at this stage."