Aer Lingus CEO coy over commitment to Ireland

Aer Lingus chief executive Lynne Embleton said the airline’s growth in Ireland relies on many factors being addressed — some by itself and some by the Government 
Aer Lingus CEO coy over commitment to Ireland

Aer Lingus chief executive Lynne Embleton said for the company to get to a point of commitment to Ireland, more “certainties” are needed. 

Aer Lingus has insisted it wants to grow its flight services at Dublin, Cork, and Shannon airports but has stopped short of saying it remains committed to Ireland.

Speaking on the back of its half-year results, Aer Lingus chief executive Lynne Embleton said the airline has “good intent” regarding rebuilding growth here. 

She said Aer Lingus wants to return to growth in Dublin and restore connectivity — including long-haul — from the regional airports.

However, Ms Embleton said to get to a point of commitment, more “certainties” are needed. 

She said despite the overseas travel ban being lifted, remaining restrictions — such as the need for expensive PCR testing for non-fully vaccinated people and children over a certain age and the Government not allowing the use of antigen testing — are hampering passenger booking growth.

She said Aer Lingus has seen an uptake in passenger bookings since the reopening of Irish skies, but growth is coming off a small comparison and flight capacity in the current quarter will be 40% less than the same period in 2019.

Aer Lingus made an operating loss of €192m in the first half of this year, down from a loss of €316m for the same period last year; its parent group IAG posted a €2bn loss for the six months, down from a loss of over €4bn for the same period last year.

Ms Embleton said Aer Lingus’ flight and passenger volumes are “nowhere near” pre-Covid levels and they won’t be “for some time”.

She said the airline’s growth in Ireland relies on many factors being addressed — some by itself and some by the Government. 

She said it would be “appropriate” for Aer Lingus to borrow more from the State-backed Ireland Strategic Investment Fund, from which it borrowed €150m earlier this year.

The Government should also provide more support through rebates on airport charges and incentive packages to allow for a fuller return to flying, she said.

The airline has closed its cabin crew base at Shannon and employs 1,200 less people than it did pre-Covid. 

More “restructuring” will be needed as “a lot of damage” has been done to Aer Lingus’ financial health due to the pandemic, Ms Embleton said.

“All our airlines continue to take significant actions to preserve their strength through the current pandemic and to position them for recovery,” said IAG chief executive Luis Gallego on the back of the group results.

As well as Aer Lingus, IAG also owns British Airways — which posted a €1.32bn first-half loss — and Spanish carriers Iberia and Vueling.

Meanwhile, Air France-KLM is predicting a return to profitability this quarter as vaccination and an easing of travel restrictions improves bookings.

The carrier has stopped bleeding cash and plans to offer 60%-70% of 2019 network capacity this quarter. 

While the airline group declined to provide an outlook for the fourth quarter, citing uncertainty about further transatlantic reopening that would allow Europeans to travel to the US, it is forecasting third-quarter earnings will be positive for the first time since the pandemic began.

  • Additional reporting Bloomberg

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