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Air Travel

Virgin Atlantic appeals for government aid

By Molly Dyson / 2 April 2020 / Contact Reporter

Virgin Atlantic at Heathrow

Virgin Atlantic has reportedly asked the UK government for hundreds of millions of pounds in state aid to stay in business during the coronavirus outbreak, with its plea backed by Airbus, Rolls-Royce and Heathrow, according to reports.

The airline has allegedly approached bankers acting for the government asking for a financial aid package after chancellor Rishi Sunak said the state would only look to provide support on a case-by-case basis after carriers had exhausted all other options.

It is understood that any loan agreed would be used to cover Virgin Atlantic��s fixed costs rather than staffing, as the majority of the carrier��s employees had already agreed to take eight weeks of unpaid leave. While most of the airline��s flights are grounded, cabin crew have been encouraged to volunteer for the NHS at a temporary hospital in East London.

Virgin Atlantic has declined to comment on the reports, but Sky News said that its request has been supported by Airbus, Rolls-Royce and Heathrow airport in letters sent to transport secretary Grant Shapps.

Airbus said the collapse of an airline such as Virgin Atlantic would have ��an extremely negative impact�� on its A330 programme because the airline has placed a large order for the aircraft with Rolls-Royce engines.

Heathrow airport is backing the call for state aid because Virgin Atlantic has?plans to massively expand if a third runway is built and hopes to become the UK��s ��second flag carrier��. The airport confirmed it has written to the government on the airline��s behalf, saying steps need to be taken ��to safeguard the future of the sector or it will risk undermining the recovery of Britain��s economy once we beat the virus��.

Virgin Group founder Sir Richard Branson announced last week that he would be injecting US$250 million into the group��s companies but warned that government support would be needed to ensure the survival of businesses such as Virgin Atlantic, Virgin Holidays, Virgin Voyages and Virgin Hotels, which he said employ a combined 70,000 people in 35 countries.

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