IAG, the parent company of British Airways, has forecasted a surge in profitability as global travel resumes. The airline industry has been hit hard by the COVID-19 pandemic, with travel restrictions and lockdowns leading to a significant drop in demand for air travel. However, with the rollout of vaccines and the easing of restrictions, IAG is optimistic about the future.
The company has reported a loss of €7.4 billion ($8.8 billion) for 2020, but CEO Luis Gallego has said that he expects the airline to break even in the second quarter of 2021. This is due to the expected increase in demand for air travel as people start to travel again for business and leisure.
IAG has also announced plans to increase its capacity by 25% in the third quarter of 2021 compared to the second quarter. This will be achieved by adding more flights and routes, as well as increasing the size of its aircraft fleet.
The company has also been working on reducing its costs, including cutting jobs and renegotiating contracts with suppliers. This has helped to reduce its cash burn rate, which was €185 million ($220 million) per week in the fourth quarter of 2020.
IAG is not the only airline to be optimistic about the future. Other airlines, such as Delta and United, have also reported an increase in bookings as people start to plan their travel for the summer. However, there are still challenges ahead, such as the ongoing travel restrictions and the emergence of new variants of the virus.
Despite these challenges, IAG is confident that it can weather the storm and emerge stronger on the other side. The company has a strong brand and a loyal customer base, and it has been investing in new technologies and initiatives to improve the customer experience.
In conclusion, IAG, the owner of British Airways, is forecasting a surge in profitability as global travel resumes. The company has been hit hard by the pandemic, but it is optimistic about the future and is taking steps to reduce costs and increase capacity. While there are still challenges ahead, IAG is confident that it can emerge stronger on the other side.
