Virgin stands down 8,000, cuts 90% flights

A file image of Virgin Australia Boeing 737-800 VH-YIR at Auckland Airport

A file image of Virgin Australia Boeing 737-800 VH-YIR at Auckland Airport

Qantas has cut all global flights and put two-thirds of its 30,000 staff on leave but so far has maintained its investment-grade credit rating.

The news comes after the airline announced it would reduce its domestic fleet by 50 per cent and temporarily suspend all global flights due to the pressures of the coronavirus pandemic.

Data firm Cirium on Tuesday estimated the number of aircraft placed in storage since January had climbed to 3,500 - up 1,000 from a day earlier - as more airlines ground planes. Starting from midnight of March 27, it would temporarily cease flights to 19 Australian destinations now operated by Virgin Australia. As it is the case with worldwide flights, the temporary suspension is expected to last until June 14, 2020.

Qantas CEO Alan Joyce told Sky News last week that Australia's government should "not look after the badly managed companies which have been badly managed for 10 years" and should not nationalise Virgin if it falters.

The airline, however, will continue operating near-daily services to 17 destinations around the country to transport essential services, critical freight and logistics.

Virgin Australia, Australia's second-largest airline group, held a 37.7% capacity share of the country's domestic aviation market, as it was outlined in the company's investors presentation in 2019.

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The 8,000 staff will be stood down until at least the end of May and will take leave without pay, but the company said it was "working with more than 25 partners to identify short- and long-term redeployment options".

Virgin Australia has stood down 80 per cent of its workforce, amid the coronavirus crisis and extensive Government travel bans. The group has a fleet of 133 aircraft across the three airline brands, namely Virgin Australia, Virgin Australia Regional and Tigerair. "From the end of this week, we will begin repositioning and grounding more than 125 aircraft in our fleet, suspending all our domestic and worldwide flying until at least the middle of June".

Tigerair Australia is suspending all services effective immediately.

Virgin's move comes after most states imposed restrictions on people crossing their borders.

Both Virgin Australia and Tigerair Australia guests who are booked to travel between now and March 31 may be able to change their flight to a Virgin Australia service departing on or before March 27, with change fees and fare difference waived.

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