Virgin Atlantic Airways said Monday it would reduce its daily flights 80% by March 26, amid the plunge in travel resulting from the coronavirus pandemic.
In addition, workers at the U.K. carrier will have to take eight weeks of unpaid leave over the next three months, with the cost spread over six months' salary.
Virgin Atlantic is owned 51% by closely held Virgin Group and 49% by Delta Air Lines DAL.
“An increasing number of countries are now closing their borders – most significantly, the U.S., where a travel embargo from the U.K. comes into force on Tuesday,” Virgin Atlantic said in a statement.
“Though this was expected, it has accelerated the sharp and continual drop in demand for flights across Virgin Atlantic’s network, meaning immediate and decisive action is needed. … Today, Virgin Atlantic will put drastic measures in place to ensure cash is preserved, costs are controlled, and the future of the airline is safeguarded.”
The airline immediately terminated its route between London Heathrow and Newark, N.J.
It’s also offering all its workers a voluntary severance package or a sabbatical of six to 12 months. All pay increases will be deferred until at least January 2021.
Virgin Atlantic urged the U.K. government to provide an emergency credit facility of 5 billion to 7.5 billion pounds (US$6.2 billion to $9.2 billion) to prevent credit-card processors from withholding customer payments.
Other major airlines worldwide are making cutbacks, though the biggest U.S. carriers aren’t cutting back to the extent that Virgin Atlantic is.
On a sharply down day on Wall Street, Delta shares at last check traded at $36.37, off 5.2%.