Continued from page 56


equity – to paper money. If you don’t agree to convert debt, you don’t get anything. “The management need to


let go of long-haul but some of the larger equity holders are long-haul aircraft lessors. “We are not convinced this


will be a good story.” Norwegian entered


bankruptcy protection in Ireland in November and in Norway in December. The Irish process, known as examinership, provides protection from creditors for only up to 100 days. The plan will mean the loss


of 1,100 jobs at Gatwick. The Unite union described it as a “devastating blow” and reported Norwegian workers are owed wages as well as redundancy pay. Norwegian said customers


with outstanding bookings “will be refunded”. However, documents provided to potential investors state only that Norwegian “will seek to establish a solution for customers eligible for refunds”. The prospectus for investors


notes the outcome of the latest rescue plan is “unpredictable” and warns: “It is highly uncertain if, and to what extent, the plan may be implemented.” It warns: “If the company


does not exit [bankruptcy protection] . . . in a successful way, it is highly likely the company will enter into liquidation and/or bankruptcy proceedings during the first or second quarter of 2021. “Even if the company should


conclude the restructuring, there is a significant risk [it] becomes insolvent and enters bankruptcy [or that] it will be in non-compliance with its debt obligations.”


Al Baker: Vaccine is not an instant fix for aviation


Ian Taylor


Unanswered questions about Covid-19 vaccines mean the airline outlook remains uncertain despite the progress of the vaccination programme, Qatar Airways’ chief executive has warned. Akbar Al Baker said the questions


“need to be clarified” before the industry can be confident a recovery is on the way. He also warned “there will be fewer airlines operating”. Speaking on a Capa Centre for


Aviation webinar, Al Baker noted: “There is no 100% guarantee the vaccines are going to work. We don’t know how long will be the effect of the vaccines. Will it be permanent or will you have to be vaccinated every year? Will the vaccine producers have the capacity to cater for the world’s population year-round? “Even if you are vaccinated, science


can’t prove you will not be infectious to other people, especially when not everybody will get a vaccine.” He warned: “You could still be a carrier


although you are not affected because you have been vaccinated. All these things need to be clarified.” Al Baker acknowledged: “There


will not be too much business traffic, but this is for the time being. Business traffic will start growing once the pandemic is under control. There will be much-reduced capacity of premium carriers. We think people will fill our premium seats.” He suggested premium leisure


customers would fill the hole left by corporate traffic, saying: “Mostly, traffic in premium will come from high-net-worth people.” Al Baker noted: “Even at the


peak of the pandemic, people are still travelling to the Maldives, the Seychelles and Zanzibar. Our premium seats on these routes are full. We started with one flight a day to the Maldives and now we operate three a day.” However, he insisted: “After the


Akbar Al Baker


pandemic is over, there will be fewer airlines operating.”


Delta posts $15bn loss but 2021 is ‘year of recovery’


Delta Air Lines reported a pre-tax loss of $15.6 billion for 2020, however Delta chief executive Ed Bastian insisted 2021 “will be a year of recovery”. The carrier reported an


“adjusted” loss before tax of $9 billion, excluding $6.6 billion in costs “related to the impact of Covid-19”. Delta ended the year with


54 21 JANUARY 2021


$16.7 billion in liquidity – including credit – and expects to receive an additional $3 billion from the US Treasury in the current quarter. The airline’s debt ballooned to


$29 billion although its “adjusted debt” was lower at just under $19 billion – more than $8 billion up year on year. Delta reported its capacity


would be just 35% down year on year in the first quarter – as US airlines continue to fly domestically – but the capacity on sale would be down 55% as the carrier continues to keep all centre-row seats empty. The carrier owed $4.5 billion in


Ed Bastian


refunds for cancelled flights at the end of the year – 65% comprising travel credits, which remain valid through to December 2022. Delta reported it refunded “more than $3 billion” in 2020.


travelweekly.co.uk


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