Richard Branson’s warning AGAINST the bailout of a British airline in the middle of Virgin Atlantic | City and business | Finance

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Earlier this week, Sir Richard warned that Virgin Atlantic would go bankrupt without government support. He called for a business loan to help the company survive the coronavirus crisis, which saw flights halted due to the airport closure. In an open letter to Virgin Group employees this week, Branson wrote, “With the Virgin Atlantic team, we will do everything we can to keep the airline running – but we will need government support to make it happen.” reach. It would be in the form of a commercial loan – it would not be free money and the airline would pay it back (as easyJet will do for the £ 600m loan the government recently granted them).

“The reality of this unprecedented crisis is that many airlines around the world are in need of government support and many have already received it.

“Without that, there will be no competition and hundreds of thousands of additional jobs will be lost, as well as critical connectivity and enormous economic value. “

He also noted that the calculation for the amount of money to be raised was based on “the value of Virgin companies in the world before this crisis, not cash in a bank account ready to withdraw.”

However, when rival Virgin Atlantic’s airline British Airways encountered similar troubles in 2009, Sir Richard said the government should avoid bailout them.

At the time, he said the airline was “worthless” and warned ministers not to bail it out if its finances deteriorated.

He added that the ministers “had better wait for his disappearance”.

The 69-year-old continued, “We and others are ready to use their routes and slots at Heathrow in the event of serious problems.

“I thought the bailout of the US government of the automakers was a bad idea and the same goes for BA. “

Branson made the remarks at a pre-Virgin Atlantic flight to New York – marking the airline’s 25th anniversary.

The statement was widely publicized in the media under headlines such as The Independent, The Daily Mail and The Guardian.

After making these comments, British Airways’ share price fell nearly 9%.

In fact, the besieged company was the biggest feller of the FTSE 100 at the time, slipping 8.65%.

READ MORE: Richard Branson: Why Virgin Care Co-Founder Called Criticism “False”

Contacted by Express.co.uk, a Virgin Group spokesperson said, “The current global crisis is unprecedented, affecting families, livelihoods and businesses in serious and unprecedented ways – it’s a whole completely different from that of 2009.

“The reality is that many airlines around the world, including Virgin Atlantic, now need government support and many have already received it.

“Virgin Atlantic’s support would take the form of a business loan and be repaid.

“Virgin Atlantic has a long history of delighting its customers and providing much-needed choice and competition that greatly benefits the British economy.”

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