Yahoo Finance BA owner IAG to increase flights but losses hit €2bn
British Airways’ owner, International Airlines Group, has announced plans to gradually return more planes to the skies after reporting a €2bn (£1.7bn) loss for the first half of 2021.
International Airlines Group (IAG) said it hoped to raise passenger capacity for the pivotal summer period to about 45% of its 2019 pre-pandemic capacity, up from only 20% for the first six months of the year, with hopes that its lucrative transatlantic UK-US routes could reopen fully.
However, the airline group said its plans “remain uncertain and subject to ongoing review”.
Government restrictions on travel hindered its financial results, which barely improved in the second quarter from the first three months of the year despite the easing of most Covid lockdown rules. IAG said that for BA, its biggest carrier, “the restricted nature of the green list severely limited the recovery in capacity expected on the lifting of lockdown restrictions”.
BA’s sister airlines Iberia and Vueling were the best performers in the group, with relatively few restrictions on their routes from Spain and Latin America.
IAG’s chief executive, Luis Gallego, said: “In the short-term, our focus is on ensuring our operational readiness, so we have the flexibility to capitalise on an environment where there’s evidence of widespread pent-up demand when travel restrictions are lifted.
“We know that recovery will be uneven but we’re ready to take advantage of a surge in air travel demand in line with increasing vaccination rates.
“We welcome the recent announcement that fully vaccinated travellers from amber countries in the EU and the US will no longer have to quarantine upon arrival in the UK. We see this as an important first step in fully reopening the transatlantic travel corridor.”
Gallego said the group would be ready to fly up to 75% of pre-Covid capacity by the autumn, should restrictions lift further.
IAG recorded a €2.3bn pre-tax loss for the first half of 2021. It said it would not guide on full-year profits given the continuing uncertainty over the pandemic and government travel restrictions.
It comes after the airline’s budget competitors Ryanair, easyJet and Wizz Air set out plans earlier this week to increase capacity closer to pre-Covid levels amid a sharp rise in holiday bookings.
EasyJet expects to return to 60% of pre-Covid levels during the summer holiday season, while Wizz expects to be the first major airline to return to pre-pandemic capacity by August.
