Welcome to London Air Travel’s Monday Briefing for the week beginning 24 August 2020.
Virgin Atlantic Crunch Vote
Virgin Atlantic’s will tomorrow (presumably virtually) convene its creditors for vote at the High Court on whether to accept its recapitalisation plan.
The Financial Times, possibly to inject some immediacy in to its reporting, suggested that talks with creditors were still underway over the weekend.
GridPoint Consulting has done an excellent breakdown of what the restructuring package actually involves. This includes no less than 170 creditors being asked to accept a 20% cut in amounts owed to them, with the balances paid in stages. Other aspects of the package appear less radical than first thought.
Creditors are expected to vote in favour of the plan which should be formally adopted in early September.
With Virgin reopening its route network at much slower pace than planned, there is no doubt it is going to face extremely difficult trading conditions over the next two years.
Qantas last week gave a relatively pessimistic view that it does not expect to restart long-haul flights until July 2021, with no US flights until the end of 2021. That said, unlike European network carriers, Qantas generates most of its profits from its short-haul domestic network. Qantas has a greater interest in unrestricted inter-state travel being opened up in Australia before international borders.
WestJet Returns To Gatwick
Some positive news for London Gatwick as WestJet has restarted flights to Calgary. These initially operate three times weekly.
WestJet tentatively plans to resume Toronto in early October. Vancouver is also scheduled to resume in early October, but as this is a summer seasonal route it is unlikely to operate until 2021. This is all of course subject to change.
STA Travel Closes Its Doors
One of the last vestiges of a bygone era closed its doors last week.
STA Travel (UK) announced late Friday evening that it had ceased trading. For a generation of student and young travellers, aided by a well thumbed copy of a Rough Guide or Lonely Planet guide book, their independent trips would be booked via STA Travel. As this was the pre-Tripadvisor era, only when you reached your accommodation did you really understand what the description “basic” and “lively” really meant.
In case you missed it:
BA CityFlyer delays the start of many year-round routes from London City to mainland Europe to October. (London Air Travel)
BA starts operating one-way “relief flights” from Johannesburg to London Heathrow. (London Air Travel)
Delta confirms its transatlantic route network from London Heathrow for the next 12 months. (London Air Travel)
Also of note this week:
How COVID-19 has shortened flight times. (The Sunday Times)
GridPoint Consulting looks at the economics of low-cost long-haul travel. (GridPoint Consulting)
A great article by Edwin Heathcote of the FT on the curse of the “AirBnb aesthetic” across the world’s cities, which applies far beyond the design apartment rentals. With interiors designed for being captured and displayed on screens what is supposedly an authentic experience has become homogenised. (Financial Times)
The Sunday Times is to close its standalone travel magazine. (Press Gazette)
Late post publication updates:
[Reserved for updates throughout the day]
Qantas is to merge its international and domestic divisions back into a single division in response to COVID-19 which will be overseen by Qantas Domestic CEO Andrew David. Qantas International CEO Tino La Spina will leave the airline.
The Civil Aviation Authority publishes domestic and international passenger data for July 2020. Unsurprisingly, traffic is still way down with some improvement on leisure routes. Heathrow has clearly benefited from the consolidation of BA Gatwick short-haul flights at the airport.
London Air Travel’s Monday Briefing is published every Monday morning at 06:00 BST and updated throughout the day. If you have any tips or stories please contact us. You can also follow us on Twitter for breaking news throughout the week.