Richard Branson’s transatlantic airline and holiday provider Virgin Atlantic announced the completion of its £1.2billion private-only solvent recapitalisation, sparking hope for the travel giant’s future. However, bosses are calling for US and UK leaders to introduce airport testing.
Shai Weiss, CEO of Virgin Atlantic described the recapitalisation and subsequent restructuring as a “fight for survival”, but states the airline can not maximise its full potential without “the introduction of passenger testing”.
In a press release, Mr Weiss said: “Together, we have achieved what many thought impossible and that is down to the efforts and sacrifices of so many across the Company.
“The completion of the private-only, solvent recapitalisation of Virgin Atlantic removes much of the uncertainty we faced and represents a major step forward in our fight for survival.
“We greatly appreciate the support of our shareholders, creditors and new private investors and together, we will ensure that the airline continues to provide vital connectivity and competition.
“Now we must focus our efforts on securing our long-term future, by ensuring that Virgin Atlantic not only survives but thrives as passenger demand returns.”
Transatlantic flying makes up 70 percent of the airline’s network, but since March 16 it has not been possible for most British nationals to enter the US upon arrival from the UK, Ireland and the Schengen area.
Meanwhile, in the UK, any arrivals from the US face 14-days of mandatory quarantine on arrival.
These decisions, Virgin says, are detrimental to the travel industry.
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Virgin bosses believe “the opening of US borders and removal of quarantine is imperative to recovery”.
In a statement, the airline adds: “The airline is calling for both UK and US governments to introduce robust passenger testing regimes to lift travel restrictions whilst protecting public health.”
The way to do this, they say, is to introduce airport testing.
“It’s clear that the introduction of passenger testing is the only way to enable the removal of travel restrictions and open up flying to key markets while protecting public health,” continued Mr Weiss.
“We will continue to work with our industry partners to press for urgent government action.”
Virgin Atlantic’s restructuring plan has been formally sanctioned by the US court and given full force and effect in the US.
The travel provider has secured support from Virgin Group and Delta, existing creditors and new private investors.
The refinancing package will be distributed over the next 18 months, along with £280million of cost savings per year and an £880million reduction in fleet capital expenditure in the next five years.
However, the airline has also had to let thousands of employees as a result of the pandemic.
More than 3,000 jobs were put on the line in May.
Yet, within hours of securing the recent rescue deal, more than 1,000 additional job cuts were announced.
“After the sacrifices so many of our people have made, further reducing the number of people we employ is heart-breaking but essential for survival,” said Mr Weiss.
“I truly hope that as demand returns, we will see many members of our team returning to us.”
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