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Brussels Airlines Extends Shutdown Through May 31, 2020 & Asks For A Handout From Belgium

by John Ollila
April 29, 2020
Reading Time: 3 mins read

Brussels Airlines, back in March (read more here), decided to suspends all flights first through April 19, then through May 15, that is today further pushed until May 31, 2020.

Brussels Airlines

The airline will also run out liquidity by the end of May, and the CEO of Lufthansa has been in touch with Belgium’s prime minister seeking cash from the state. It is unclear if the airline can fly again without a bailout, and Lufthansa itself is in talks going into reorganizations/bankruptcy reorganization (read more here).

You can access Brussels Airlines here.

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Here’s the announcement from the airline:

  • The ongoing travel restrictions around the world and the continued low to no demand resulting hereof, obliges Belgium’s home carrier to extend the temporary suspension of its operations by another two weeks. As a consequence, flight operations will not restart before June 1st
  • Customers have the time until 31 August 2020 to rebook their tickets to a new departure date and/or other destination. Travel can be postponed until 30 April 2021. More information can be found on www.brusselsairlines.com
  • The Belgian carrier keeps capacity standby for possible additional repatriation flights and the transport of humanitarian freight
  • To restart its operations, Brussels Airlines works on a reduced but stable flight offer that will gradually be increased following the evolution of the demand
  • Temporary technical unemployment for all 4.200 Brussels Airlines employees will be extended in line with the temporary suspension of its flight operations.

The worldwide Coronavirus crisis and the ongoing travel restrictions imposed by many countries around the world, oblige Brussels Airlines to further postpone the restart of its operations, which was planned for May 15th. The airline has now decided to extend the temporary suspension of its flights until May 31st . Customers who have provided their phone number or e-mail address during the booking process will be automatically informed about changes in the flight programme. Furthermore, an extensive goodwill policy for customers is in place, offering passengers the opportunity to postpone their travel plans until latest 30 April 2021. In line with the extension of the flight suspension and a gradual restart of its operations, Brussels Airlines will prolong the temporary technical unemployment for the entire company.

Brussels Airlines today decided to extend the temporary suspension of all its flights. Until May 31st, the airline will focus on possible additional repatriation flights and the transport of cargo.

“Based on currently available figures, the aviation industry expects only a gradual recovery of the demand for air travel. For that reason, we also plan a phased build-up of our network and flight offer. The world of travel after the Coronavirus crisis will look different from before. We are preparing ourselves to make sure that we are ready for this new reality. When the world is ready to fly again, we will be too.”

Dieter Vranckx, CEO Brussels Airlines

Here’s an excerpt from the Brussels Times (access their piece here):

Brussels Airlines is currently in talks with the government over state support for the airline, which says it has only enough resources to last until the end of May. It is reported to be asking for €290 million.

Spohr also assured Wilmès that any state aid given by the Belgian government would be used by Brussels Airlines alone, addressing critics who suggested the money might disappear into a group fund instead of going where it was intended to go.

Despite having a war chest of some €4 billion, Lufthansa has had to concentrate its efforts on keeping its German company out of trouble, and has sent its Swiss, Austrian and Belgian subsidiaries to their own governments for aid.

Conclusion

Lufthansa is in no position of helping its Swiss, Austrian, and Belgian subsidiaries that have been left alone to seek help (read cash infusions, loans & guarantees) from their respective governments due to losing one million per hour.

It is up to four European governments to help keep the Lufthansa Group solvent. Lufthansa has indicated that it is not willing to give rights, shares, or board seat(s) to the German government with whom it has been in talks with regarding major cash infusion.

Lufthansa and Brussels Airlines here are signaling to Begin government that the airline is not flying again (by leaking the running out of cash date & planning to restart operations from the same date) unless fresh funds are coming.

I am not sure how Lufthansa can ensure respective governments that it won’t mix and match cash between its four airlines?

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