Global airlines are fast running out of cash after cutting capacity by 90% or even grounding entire fleets due to the broad travel restrictions to contain the spread of the coronavirus, calling into question the survival of several firms.
The outbreak of the flu-like virus has wiped 41%, or $157 billion, off the share value of the world’s 116 listed airlines, with many using up their cash so fast they can now cover less than two months of expenses, a Reuters analysis showed.
The industry’s main global body, the International Air Transport Association (IATA), estimates the sector needs up to $200 billion in government support to help airlines survive.
The following charts show airlines’ liquidity ratios, and their changes in cash and debt levels against core earnings.
South African airline SA Express suspends operations, partly due to coronavirus
South African state-owned airline SA Express said it would suspend operations from today until further notice because of recent developments, including the impact of a rapidly spreading coronavirus pandemic.
The global aviation industry is battling to survive a plunge in demand caused by the virus, with some airlines seeking government bailouts or grounding most of their fleets.
SA Express, which flies to domestic and regional destinations, said it would accommodate customers on alternative flights and non-critical staff would go on compulsory leave.
“The airline will utilise this period to review its current network and streamline operations for improved efficiency,” it said in a statement.
SA Express entered a form of bankruptcy protection this year, after a court battle with a contractor, logistics firm Ziegler.
It is a separate business from much larger state carrier South African Airways, which is also under bankruptcy protection.
