Ryanair and Easyjet Planning to Scale Up Business Operations from the Next Month

Novel coronavirus has become a vicious threat to the functioning of the entire world. The coronavirus was found in the Wuhan, China for the first time and then later spread to the different parts of the globe. As per the World Health Organization, over 6.2 million people have been impacted with COVID-19, and around 376K people have died due to infection to date. The United Kingdom ranks second after the United States of America, where death cases have been high as compared to the other developed countries. However, novel coronavirus is not only taking human lives, but has battered global economy with many industries such as retail, airlines, and leisure industry struggling for survival.

The airline industry got one of the most massive setbacks due to novel coronavirus lockdown. As per the media report, on 24th March 2020, the International Air Transport Association updated that the impact of novel coronavirus could be over its previous estimation of $113 billion or £96 billion in revenue loss. During such a situation, airlines such as Ryanair and EasyJet have declared that they will scale up their business operations from July 2020 as they are trying to sail through at least to the part of the vital summer period. The strategies are going onward despite an initiative to force all international entrances to self-isolate for 14 days of quarantine.

As per the media report, airlines services will be available to many destinations in July 2020. It includes Cyprus, Czech Republic, Austria, Greece, Hungary, Ireland, Poland, Portugal, Romania, Italy, Latvia, Lithuania, Luxemburg, Malta, Montenegro, Norway, Poland, Portugal, Morocco, Netherlands, Norway, Slovakia and Sweden, among others. In May 2020, the Ryanair stated that it would restart 40 per cent of its aeroplanes to the skies during June 2020, growing that to 60 per cent in August and September. EasyJet also declared that it has to arrange many of the items on designated routes once it will begin its operations from 15th June 2020. The most of these primary air travel will be for domestic travel within the United Kingdom, who can travel among across different countries and cities but within UK like from Bristol to Belfast. EasyJet would reportedly provide just one global route from the UK, which is between London Gatwick and Nice in France.

Implementation of wearing face mask at airports and onboard flights is a way of new safety procedure and cleanliness actions focus to strengthen the safe air travels. Airline companies have adhered to the strict social distancing rules and have directed their all passengers and cabin crew members to wear face mask and check temperature regularly while on flight. However, in the last days of May 2020, EasyJet declared procedures to cut 4,500 employees, while Ryanair is ready to suspend around 3,000 staffs. It is part of a trend of cuts globally as the industry struggles to continue businesses.

Let’s talk about the share price performance of Easyjet Plc and Ryanair Holdings Plc

The share price performance of Easyjet Plc (LON:EZJ) - At around 08:42 AM GMT, on 03^rd June 2020, the stock price of Easyjet Plc is trading at GBX 746.20, higher by 2.98 per cent or 21.60 points as compared to the previous day’s closing price of GBX 724.60. The company’s one year high/low price is GBX 1,570.0 / GBX 410.0, which were reported on 13^th February 2020 and 19^th March 2020, respectively.

The share price performance of Ryanair Holdings Plc (LON:RYA) - At around 08:44 AM GMT, on 03^rd June 2020, the stock price of Ryanair Holdings Plc is trading at EUR 12.16, higher by 1.04 per cent or 0.125 points as compared to the previous day’s closing price of EUR 12.03. The company’s one year high/low price is EUR 16.97 / EUR 8.05, which were reported on 10^th January 2020 and 23^rd March 2020, respectively.

Impact on Airline Industry Globally amid Novel Coronavirus Lockdown

The Airline industry in the United Kingdom and other nations have faced many challenges with considerable losses in profit due to the coronavirus pandemic. Due to this, many companies experienced job losses and undefined futures. As per the media report, the two largest carriers have displayed huge losses until May 2020- American Airlines reported a quarterly net loss of 2.2 billion dollars, whereas Southwest reported a net loss of $94 million in first quarter 2020 during the lockdown. At the initial time of the pandemic, British airlines and airports were also expressed not to assume an industry-wide bailout from the head of government, as the International Air Transport Association cautioned that airlines were going to lose £251 billion in revenue in the year 2020.

The Chief Executive Officer of Boeing believe that major carries would go out of business in this year 2020 due to COVID-19 outbreak. Moreover, another consequence on air travellers is expected to be the costlier tickets and more stopover for infection checks.

During this lockdown, the more prominent airline companies which consist of British Airways and Qatar Airways have declared sharp job cuts with many employees put on furlough. The airline companies were pressurised to take such complicated steps due to almost no business activities under the present conditions. Numerous airline companies have also filed for insolvency as well as the international airline companies have also been worried in March-April 2020, which consists of Trans State Airlines and Compass Airlines in the United States, Australia's Virgin Australia and British carrier- Flybe.