Tony Douglas, chief executive of Etihad Airways has told CNBC in a recent interview that his airline has “received remarkable support from our shareholder” in response to questions about a state bailout. Etihad is 100 per cent owned by the Abu Dhabi government and it’s widely believed Douglas referencing “remarkable support” was an acknowledgement that the airline had received a hefty financial bailout.
Douglas, however, was unwilling to say how much money Abu Dhabi had injected into the carrier. “We’re not a publicly listed company so we don’t disclose anything of that nature,” Douglas told the financial news station before saying he was “sure that Etihad will be one of the winners out of all of this.”
Yesterday, rival Gulf carrier Qatar Airways revealed it had received a $1.95 billion injection from the Qatari government to see it through the COVID-19 pandemic, as well as several other challenges the airline had faced over the last 12-months. Qatar Airways posted a $1.92 billion loss for the 2019/2020 financial year.
Other airlines seeking financial state bailouts have also been open about the financial support they’ve received. Lufthansa has won a €9 billion bailout from the German bailout, while major U.S. airlines have received at least $25 billion to fund payroll support through to the end of September.
“The U.S. airlines have had a massive bailout, many others have all around the world and I can’t see that likely to stop anytime soon,” Douglas said. “The simple reality is, not only have many airlines gone into administrative processes already, many of them will not come out of the other end without some support or another and we have remarkable support from our shareholder.”
In 2016, Etihad recorded a record loss of $1.95 billion, followed a year later with a $1.52 billion. Those losses narrowed to $870 million last year although the COVID-19 is likely to wreak havoc on the airline’s finances.
“Have we been laying thousands of people off,” Douglas said. “Sadly, yes have,” while refusing to give specific details. Douglas also said he couldn’t guarantee that more employees wouldn’t be laid off in the coming weeks and months as the airline navigated through the COVID-19 pandemic.
The one consolation for laid-off workers was that Etihad intends to offer them jobs before hiring externally through what Douglas called an ‘alumni scheme’.
After grounding flights in March for five months, Etihad has since resumed regularly scheduled flights to around 57 destinations worldwide. Etihad’s recovery, however, remains hampered by tough COVID-19 prevention measures enforced by the Abu Dhabi government that stop most travellers entering the emirate.
