Virgin Atlantic is set to apply for hundreds of millions of pounds in state aid in a bid to keep afloat during the coronavirus crisis, according to reports.
The carrier will be one of the first in the UK to ask for government help after ministers said this week it would only help the struggling industry as a “last resort”.
Reports suggest other airlines including easyJet and regional carriers such as Loganair and Eastern Airways are also considering following Virgin Atlantic’s lead.
Almost all staff at Virgin Atlantic have accepted unpaid leave and Richard Branson has said he will inject $250m into companies across his group, including Virgin Voyages and Virgin Holidays.
Virgin Atlantic is understood to have approached the government and bankers Rothschild for a package worth hundreds of millions of pounds in commercial loans and guarantees, reports The Guardian.
Chancellor Rishi Sunak has confirmed the government will not offer an industry-wide bailout to airlines and airports struggling in the crisis. The government instead wants the sector to explore options to bolster cash before asking for state aid, with each request considered on a case-by-case basis, according to The Financial Times.
The UK government has adopted a different approach to other countries. On 19 March, the Norwegian government proposed a guarantee of NOK 6 billion for the Norwegian airline industry, of which up to NOK 3 billion is directed to Norwegian.
In the US the airline industry is seeking a US$50 billion support programme, with indications are that at least some of that will be forthcoming.
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