MIAMI – Qatar Airways (QR) is in need of government support, according to Chief Executive Akbar al-Baker, as the Middle East carrier is poised to run out of the cash but vows to continue flying.
Qatar is one of few airlines that has maintained its scheduled commercial passenger services, expecting to operate 1,800 flights in the next two weeks, according to a report by Reuters.
“We have received many requests from governments all over the world, embassies in certain countries, requesting Qatar Airways not to stop flying,” Baker told the news outlet.
The CEO assured that QR would keep flying as long as it was necessary, as the airline has been asked to get stranded travelers back home “provided the airspace is open and the airports are open,” but warning that it will run out of cash soon.
Even though the carrier is taking measures to save cash, Baker, while not setting an actual date, said QR would eventually ask for state aid in the form of loans or equity.
The cash-saving measures include employees taking paid and unpaid leave voluntarily and Baker forfeiting his salary until the airline returns to full operations. Pay cuts are not on the table at this moment.
Closed borders and financial losses
Following the United Arab Emirates’ (UAE) government decision to shut down all passenger flights, Etihad Airways (EY) halted services to/from UAE while Emirates grounded its fleet until further notice – Qatar is now operating at 50% capacity.
Etihad and other carriers in the region suspended operations and grounded aircraft as the UAE National Emergency Crisis and Disaster Management Authority and the General Civil Aviation Authority (GCAA) closed borders except for cargo and emergency evacuation flights.
While the pandemic would report a loss for QR in 2020 as it has to fly longer, more expensive routes because of the border shut-downs in adjacent countries, Baker admitted that this was a time “to serve people who want to be with their loved ones in a very trying time.”
Alas, Qatar Airways joins the ranks of airlines in need of support, as European carriers face a potential revenue loss of US$76bn with passenger demand at 46% below normal, putting at risk about 5.6 million jobs and $378bn in GDP.
The United States offered US$58 billion in aid for its aviation industry, with United Airlines (UA) receiving a 2$bn floater. We’ll see if QR has the same fate.
Airways will continue to report on the latest developments of the COVID-19 outbreak and its fallout on the international aviation industry.