Wizz Air Holdings PLC (LON:WIZZ) shares lost altitude on Monday after the carrier grounded 85% of its fleet and said a total stoppage was a “distinct possibility” as the coronavirus pandemic slammed the brakes on air travel.
The firm, which flies mostly to and from central and eastern Europe, said potential additional travel restrictions and social distancing policies “may make international flying for commercial purposes either untenable or impossible” in the coming weeks, and as a result all of its planes could be kept out of the skies.
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Despite this, Wizz said it had “significant balance sheet strength and liquidity” and was “confident in its ability to survive even a potential prolonged grounding substantially beyond the current estimates for the impact of [coronavirus] in Europe”.
The firm also unveiled a number of measures to cut costs, including “voluntary working hour reduction options and leave options” for its employees, adding that its board and executive leadership team will also be giving up their salaries for five weeks.
“Our ever-disciplined attitude to cost and cash enables Wizz Air to take decisions that are right for crew, passengers and communities even in the context of demand and travel restrictions due to the [coronavirus] pandemic in Europe”, said Wizz Air chief executive József Váradi.
“However, this situation is posing a significant threat on the aviation industry and we call on governments to take non-discriminatory steps which will benefit all airlines. This will enable an industry and environment that is healthy, efficient and more environmentally sustainable and will serve passengers through enhancing the mobility of people", he added.
Shares in the airline fell 9.2% to 2,068p in late-afternoon trading.