In response to the multiplying travel bans over the last week Ryanair will be grounding the majority of its fleet across Europe for the next 7 to ten days and said it expects to reduce seat capacity by 80% during April and May.
In a statement announcing the move Ryanair cited the variety of travel bans which have been imposed over the last week by the governments of Italy, Malta, Hungary, Czech Republic, Slovakia, Austria, Greece, Morocco, Spain, Portugal, Denmark, Poland, Norway and Cyprus.
It added that those countries where the fleet is not grounded, social distancing restrictions may make flying to all intents and purposes, impractical, if not, impossible, and it said a full grounding of its fleet could not be ruled out.
Ryanair said it is taking immediate action to reduce operating expenses and improve cash flows. This will involve grounding surplus aircraft, deferring all capex and share buybacks, freezing recruitment and discretionary spending, and implementing a series of voluntary leave options, temporarily suspending employment contracts, and significant reductions to working hours and payments.
The carrier said it has strong liquidity, with strong cash and cash equivalents of over €4bn as at 12 March.
Ryanair’s chief executive Michael O’Leary said, “we are doing everything we can to meet the challenge posed by the Covid-19 outbreak, which has over the last week caused extraordinary and unprecedented travel restrictions to be imposed by National Governments, in many cases with minimal or zero notice.
Ryanair is a resilient airline group, with a very strong balance sheet, and substantial cash liquidity, and we can, and will, with appropriate and timely action, survive through a prolonged period of reduced or even zero flight schedules, so that we are adequately prepared for the return to normality, which will come about sooner rather than later as EU Governments take unprecedented action to restrict the spread of Covid-19”.