Emirates Got $2 Billion from Dubai to Survive Crisis Months
(Bloomberg) -- Dubai’s government has put 7.3 billion dirhams ($2 billion) into Emirates since the coronavirus pandemic brought global air travel to a near halt in March and said it’s prepared to send more help to its flagship airline.
The state indicated earlier in the year it was committed to providing financial support to the world’s largest long-haul carrier, and a bond prospectus seen by Bloomberg shows the extent of the aid provided over the past five months.
“Any further support will be subject to the airline’s requirements and will depend on the impact and duration of the ongoing Covid-19 situation,” according to the document.
Emirates was particularly hard hit by the pandemic because its business model is built around the biggest category of jets -- Airbus SE A380s and Boeing Co. 777s -- carrying passengers between all corners of the globe. Long-haul travel is widely expected by the industry to be the slowest to recover from the crisis as passengers shy away from lengthy journeys and virus hotspots.
Dubai joins a list of international governments that have been forced to step in to save their national carriers, with the likes of Deutsche Lufthansa SA receiving billions of dollars to sustain them through the crisis. While many borders have reopened as the initial surge in infections waned, the pace of recovery has been hampered by subsequent travel restrictions to help contain fresh outbreaks.
Emirates resumed some regular passenger flights on May 21 after suspending most trips for almost two months. The airline expects to increase its network to 80 destinations in September, Chief Operating Officer Adel Al Redha said in an interview earlier this month, with service to all destinations by 2021.
Emirates has begun the process of firing thousands of workers to help preserve cash amid the persistent downturn, and is considering other ways to streamline operations. The carrier is also negotiating with Boeing on its preferred mix of new wide-body planes, with the focus likely to be on smaller aircraft.
The $2 billion figure was earlier reported by Reuters.
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