Coronavirus: easyJet and BA owner cut European flights

EasyJet and the owner of British Airways are scaling back services in Europe as coronavirus cases surge.

International Airlines Group (IAG), which includes BA, Iberia and Aer Lingus in its stable of brands, told investors it had seen weaker demand across Asian and European routes.

The company's chief executive, Willie Walsh, told Sky News it was taking capacity out of Italy - building on the suspension of flights to Shanghai and Beijing.

EasyJet said it was cancelling several flights in Italy and seeking to concentrate passenger numbers on less frequent services in a bid to manage costs.

The airline said actions were expected to include a pay freeze across the business and the offer of unpaid leave.

It said the customers it was contacting to make alternative arrangements in Italy could either switch flights or request a full refund.

IAG and easyJet have been among the worst affected amid a bloodbath for shares this week that began on news of a surge of cases in northern Italy.

Companies associated with the travel sector have felt the most pain on investor expectations that they have the most to lose in the short term because of restrictions on movement to contain the COVID-19 outbreak.

In its update to investors on Friday, IAG said its business travel operations had suffered most through the cancellation of major events in Asia.

It revealed a dip in operating profits of almost 6% for 2019 but, crucially, said it was unable to provide guidance on profitability for the current year because of the developing coronavirus crisis.

Mr Walsh said: "The impact to date is quite minimal because it's principally been as a result to the changes in Asia and we've mitigated that by actions we've taken, so in our statement today we've reassigned some of the capacity we've taken out of Asia to other parts of our network where demand is strong.

"Today we've also said we've taken capacity out of principally Italy because we've seen a very strong fall off in demand right across our group, so it's impacted on all our airlines."

EasyJet, like IAG, said it was constantly monitoring the situation and would update investors and passengers alike as appropriate.

The low-cost carrier said it was focusing on delivering operational efficiency and cost savings in anticipation of disruption - adding that its summer schedule was under review to maximise "revenue opportunities on market recovery".

On the current situation, its statement said: "Following the increased incidence of COVID-19 cases in northern Italy, we have seen a significant softening of demand and load factors into and out of our northern Italian bases.

"Further, we are also seeing some slower demand across our other European markets.

"As a result 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.

"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."