BA cuts capacity again as second Covid wave batters industry

Tuesday, 22 Oct, 2020 0

British Airways has further cut capacity after the government’s failure to adopt pre-departure Covid testing.

The airline will now operate just 30% of its usual capacity in the fourth quarter of 2020, down from 40% previously announced.

The cuts were announced as BA parent International Airlines Group (IAG) said it suffered an operating loss of €1.3 billion in the third quarter, down from a €1.4 billion profit last year.

Revenue collapsed 83% to €1.2 billion – down from €7.3 billion last year.

IAG said bookings have ‘not developed as previously expected’ due to additional measures taken in Europe to combat the second wave of Covid.

An increase in local lockdowns and the dwindling number of destinations on the travel corridor list have all hit business, it said.

But the slow progress in replacing quarantine was also blamed by the airline.

"Initiatives designed to replace quarantine periods and increase customer confidence to book and travel, such as pre-departure testing and air corridor arrangements, have not been adopted by governments as quickly as anticipated," IAG said in a statement.

The company said it now longer expects to break even in terms of net cash flow from operating activities during the quarter.

Capacity declined 79% in the three months to the end of September while passenger traffic, measured in revenue passenger kilometres, fell 88%.

Load factor declined from 88% to by 49%.

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