Category: Business News

The boss of Delta Airlines says the carrier will continue to limit the number of people on its planes beyond September.

So far the airline has been capping the numbers on board its flights to no more than 60% of capacity.

It is aiming to limit the spread of coronavirus and implement some form of social distancing.

Chief Executive Ed Bastian told the BBC that some of the details of the plan still need to be worked out.

He told the BBC: “We will be extending the cap on the planes post September, whether it’s 60% or a slightly higher number I don’t know, but yes we absolutely will.”

It’s significant because it means the world’s second-biggest airline by passenger numbers could well be running flights at a loss for a longer period of time.

Financial pressure

Data from the US Department of Transportation suggests that last year, Delta needed to fill 70.6% of the seats on its flights to cover its costs.

However airlines are now under even greater financial pressure, with planes sitting idle thanks to the huge fall in global demand for air travel.

Even those sitting on the tarmac cost their owners money, including through airport fees and maintenance costs.

Aviation analyst John Grant, from OAG, says that Delta is in a stronger position to break-even than its big US rivals American and United who need 78.6% and 73.8% capacity respectively to do so.

He explains that “those sort of break-evens are pretty typical around the globe”, adding that “2019 was a good year though, with the cost of fuel very low compared to recent years and it can obviously fluctuate based on a mix of those costs and revenues per passenger.”

American has not limited its capacity and United has a policy to allow passengers to choose to rebook on a different flight or receive a travel credit when flights are 70% full.

More routes are returning to Delta’s schedule, with the carrier this week becoming the first US airline to reintroduce flights to China after a row between Washington and Beijing.

‘Choppy recovery’

Nonetheless, Delta’s boss acknowledges that it’s not going to be straightforward to increase the number of passengers on each plane. With cases of Covid-19 now estimated to have passed 20 million in the United States, Mr Bastian says “of course” he is worried about a second wave of the outbreak.

“I’ve said throughout this pandemic that it’s going to be a choppy recovery, it’s going to be stops and starts and the virus is going to move, just as people move.”

Like other airlines, Delta has measures in place to try and protect those on board its planes.

Mr Bastian says, “We need to make certain that we take all precautions for our people, for our customers, reinforcing wearing masks, social distancing, keeping our planes only at 60% full, making certain every seat next to a customer is open, so you have space on board, and doing everything we can to be cautious in the face of the spread.

“Because until there is a vaccine it’s going to be very hard to see this industry back at scale.”

Mr Bastian concedes that the reduction in scale will mean cutting the number of staff, which is currently around 90,000.

Those roles are all protected until the end of September under the terms of a $5.4bn (£4.38bn) bailout plan funded by the US federal government.

But when the crunch comes Mr Bastian hopes that volunteers will make the process less painful.

Virgin deal

“We’re doing everything we can to hold on to as many jobs as possible, and while the job count will go down, our goal is to make it as voluntary for employees as we can”.

As the airline tries to map out its future, thousands have signed up for early retirement whilst 37,000 others are taking time off without pay, in periods ranging from 30 days to a year.

In recent years, Delta has pursued a strategy of growing through the acquisition of stakes in other airlines, including LATAM which has sought bankruptcy protection in the US, and China Eastern.

Virgin Atlantic, has already announced more than 3,000 job cuts and remains in financial difficulty, with previously lucrative transatlantic crossings struggling like other routes.

Delta owns 49% of Virgin, but Mr Bastian says it won’t be putting any more cash in and hopes to avoid administration.

Worst year

“We’re not planning on injecting additional capital into Virgin. We’re supporting them in doing everything we can, helping them through a restructuring, hopefully to avoid an in-court process, and I’m still optimistic, cautiously optimistic that we’ll be able to get there”.

Aviation analyst Andrew Charlton isn’t as confident about Virgin Atlantic’s prospects saying that he will “watch the process with fascination”.

He adds that “the jury is still out on Delta’s international expansion because the pandemic means there is almost no international long-haul travel, which is normally quite profitable, and the airlines in which it has stakes don’t all have strong domestic networks to tap into”.

The global airline body IATA is forecasting the industry’s worst ever year with losses of more than $84bn.

But Mr Charlton thinks ultimately Delta is “well positioned” to weather the coronavirus storm compared to other carriers. This, he says is “thanks to a strong financial position and its US domestic position” which accounts for 70% of ticket sales.

You can watch Ed Bastian’s full interview on Talking Business with Aaron Heslehurst on BBC World News at Saturday 2330 GMT,

The UK’s biggest travel money provider is resuming services suspended during coronavirus lockdown as tourists gear up for a potential summer getaway.

The Post Office, which deals with about one in four travel money exchanges, is ending its suspension of services such as delivery and click and collect.

It comes as the chances of a summer holiday overseas improve amid government plans for air corridors.

Other providers have continued with online orders but closed bureaux.

‘Growing interest’

The Post Office suspended a number of its travel money services in late March, as lockdown ensured most people stayed at home.

Online orders for foreign currency are being accepted again, although this has a £400 minimum order.

Click and collect will available again from various branches nationwide from 1 July, also with the £400 minimum.

Pre-ordering of foreign currency in branches is restarting gradually. On the spot exchange in branches did continue during lockdown if stocks were available, although demand was low as people stayed at home.

Nick Boden, head of Post Office Travel Money said: “We have been monitoring the position carefully in recent weeks and are aware of growing consumer interest in holidays as lockdown rules have relaxed.

“We’re following FCO (Foreign and Commonwealth Office) advice closely and we advise holidaymakers to do the same.”

The FCO has advised against all but non-essential travel from the UK for some time.

Other foreign exchange providers, such as Travelex, have maintained some services throughout lockdown, although this has been through delivery to people’s homes rather than in bureaux.

The coronavirus outbreak brought a flight to safety among many investors, prompting a dramatic fall in the value of the pound against the euro.

A partial recovery since means that travellers to the proposed air corridor countries – most of which use the euro – will receive less than they would have done in February.

Air corridors will allow people to travel without being required to quarantine for 14 days after they return.

Rates blow

The Post Office rate is 8.2% lower than the February peak, with £1 buying €1.08 now rather than close to €1.18.

However, it is only 1.4% worse than the €1.095 rate of a year ago.

Norway is one of the countries expected to be on the list of air corridors, and the pound is 10% stronger against the Norwegian krone than it was a year ago.

Customers purchasing currency from the Post Office online or from its branch network will be refunded if their holiday is cancelled owing to coronavirus.

High Street rates are lower than those on the currency markets.

UK holidaymakers are expected to be allowed to travel to Spain, France and Greece this summer after ministers confirmed people returning from certain countries will not have to quarantine.

The rules will be relaxed on 6 July after a review of health measures.

The full list of travel corridors with the UK will be published next week.

Italy, the Netherlands, Finland, Belgium, Turkey, Germany and Norway are also expected to feature but it is thought Portugal and Sweden will not.

A government spokesman said the new rules would give people “the opportunity for a summer holiday abroad” while also boosting the UK economy – but stressed the relaxation depended on risks staying low.

A traffic light system will be introduced – with countries classified as green, amber and red depending on the prevalence of coronavirus. The government said it “wouldn’t hesitate to put on the brakes” if the situation changes.

Portugal has seen a rise in the number of new cases in and around Lisbon recently, while Sweden is also unlikely to be on the list because the infection rate there is higher than in the UK. They are both likely to be classified as red.

But the government spokesman conceded there would be nothing to stop someone avoiding quarantine by flying into a Spanish airport, driving over the border into Portugal for their holiday and returning by the same route.

The travel sector has gone to war with the government over its blanket quarantine policy.

So a more nuanced, risk-based approach will quieten the critics to some extent.

But the storm of controversy swirling around this policy won’t completely go away.

Portugal, which will probably not be on next week’s list of exemptions, feels hard done-by.

The country is desperate that UK tourists return.

And although in public health terms the US is not currently close to being on the list, it does potentially present a tricky diplomatic dynamic, given the normally cosy relationship between Washington and London.

And the transatlantic flight market is lucrative too.

This announcement is a step in the right direction for UK aviation, but they want testing at airports to also provide another way for passengers to be exempt. So far, in public, the government has said very little about that.

UK travellers will still have to hand over the address they plan to stay at on their return from abroad, no matter which country they are coming back from. And they will also be legally required to wear face coverings on planes and ferries.

Travel industry group ABTA described the relaxation of quarantine rules as “encouraging”.

“Confirmation of the list of countries is eagerly anticipated by the travel industry, and should encourage customers to book,” it said in a statement.

“The blanket Foreign Office advice against all but essential travel is still a major impediment to travel, however, and we look forward to the government adopting a similar risk-based approach to that advice.”

The UK introduced rules requiring all people arriving in the UK to self-isolate for 14 days on 8 June. It was widely criticised by the travel industry and MPs of all parties.

What are the current quarantine rules?

• People arriving in the UK should drive their own car to their destination, where possible, and once there they must not use public transport or taxis
• Arrivals must not go to work, school, or public areas, or have visitors – except for essential support. They are also not allowed to go out to buy food, or other essentials, where they can rely on others
• Those arriving in England, Wales and Northern Ireland could face a fine of £1,000 if they fail to self-isolate for the full 14 days, while they face a £480 fine in Scotland. The maximum fine for repeat offenders in Scotland is £5,000.

For more on the rules click here.

Home Secretary Priti Patel said the laws were designed “to prevent a second wave” of coronavirus.

Foreign Office advice against all but essential international travel has been in place since 17 March.

“Our public health measures at the border were put in place to manage the risk of imported cases and help prevent a second wave of the virus, and will continue to support our fight against coronavirus,” said a government spokesman.

“Our new risk-assessment system will enable us to carefully open a number of safe travel routes around the world – giving people the opportunity for a summer holiday abroad and boosting the UK economy through tourism and business.

“But we will not hesitate to put on the brakes if any risks re-emerge, and this system will enable us to take swift action to re-introduce self-isolation measures if new outbreaks occur overseas.”

Facebook has said it will start to label potentially harmful posts that it leaves up because of their news value.

The more hands-on approach comes as the social media firm faces growing pressure to take stronger action to moderate the content on its platform.

More than 90 advertisers have joined a boycott of the site, including consumer goods giant Unilever on Friday.

The firm said it would halt Twitter, Facebook and Instagram advertising in the US “at least” through 2020.

“Continuing to advertise on these platforms at this time would not add value to people and society,” the maker of Dove soap and Ben & Jerry’s ice cream, said.”We will revisit our current position if necessary.”

• Ben & Jerry’s joins Facebook ad boycott
• US phone giant Verizon joins Facebook ad boycott

In a speech on Friday, Facebook boss Mark Zuckerberg defended the firm’s record of taking down hate speech.

He pointed to a European Commission report this month that found Facebook removed 86% of hate speech last year, up from 82.6%.

‘Public interest value’

But he said the firm was tightening its policies to “address the reality of the challenges our country is facing and how they’re showing up across our community”.

In addition to introducing labels, Facebook will ban ads that describe people from different groups, based on factors such as race or immigration status, as a threat, he said.

“A handful of times a year, we leave up content that would otherwise violate our policies if the public interest value outweighs the risk of harm,” he said. “Often, seeing speech from politicians is in the public interest, and in the same way that news outlets will report what a politician says, we think people should generally be able to see it for themselves on our platforms.

“We will soon start labelling some of the content we leave up because it is deemed newsworthy, so people can know when this is the case,” he said.

He added that Facebook would remove content – even from politicians – if it determines that it incites violence or suppresses voting.

Twitter has already taken some steps, including banning advertisements from politicians and adding labels and warnings to some kinds of content.

“We have developed policies and platform capabilities designed to protect and serve the public conversation, and as always, are committed to amplifying voices from under-represented communities and marginalized groups,” said Twitter executive Sarah Personette.

Shares of Facebook and Twitter both fell more than 7% on Friday.

Why are companies boycotting Facebook?

The “Stop Hate for Profit” campaign was started by US civil rights groups after the death of George Floyd in May while in police custody. It has focused on Facebook, which also owns Instagram; and WhatsApp and last year attracted advertising revenue of almost $70bn (£56.7bn).

The organisers, which include Color of Change and the National Association for the Advancement of Colored People, have said Facebook allows “racist, violent and verifiably false content to run rampant on its platform”.

Color of Change president Rashad Robinson said the steps announced by Mr Zuckerberg showed a “failure to wrestle with the harms [Facebook] has caused on our democracy & civil rights”.

“If this is the response he’s giving to major advertisers withdrawing millions of dollars from the company, we can’t trust his leadership,” he wrote on Twitter.

More than 90 companies including Verizon and Patagonia have joined the campaign, according to a list by ad activism group Sleeping Giants, one of the organisers.

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Nicole Perrin, analyst at eMarketer, said it will be difficult to determine the financial impact of the boycott on Facebook, given the significant changes in advertising amid the pandemic.

But she said Unilever’s announcement was significant, noting that the firm was dropping the ads for longer than called for, and on more platforms.

“That suggests a deeper problem with user-generated content platforms, as divisiveness is to be expected on any such platform that allows political expression,” she said.

Thousands of people in the UK are unable to access their money owing to the fallout from the scandal to hit payments firm Wirecard.

The UK licence of Wirecard Card Solutions has been frozen by the regulator after its German parent company filed for insolvency.

It means people are temporarily unable to access cash held with financial apps in the UK using Wirecard technology.

Some have spoken of their frustration, but their money should be safe.

Wirecard Card Solutions serves prepaid cards, such as the U Account, which marketed itself as an alternative to a bank which helped people to budget and avoid hefty overdraft fees.

“This is a massive issue for many customers who rely on the money placed in their U account for everyday essentials including the ability to pay rent and buy food,” one customer told the BBC.

‘Money is safe’

The regulator, the Financial Conduct Authority (FCA) said it had ordered Newcastle-based Wirecard Card Solutions “to cease all regulated activities in order to further protect customer money”.

Financial technology firms Pockit; Anna Money, a business account; and Curve, which aims to consolidate people’s finances in one app, told customers they would be blocked from their accounts after the FCA’s decision.

They said that customers’ money was still safe, but would not be accessible for a time.

“This action is not related to Curve – but Curve currently depends on Wirecard for operation of the Curve card,” Curve told customers on Friday.

“We are already well on the way to migrating away from Wirecard but have not fully completed this process.”

Anna said: “We expect the suspension to be lifted – the inability to use your account and card is temporary, and we are working to restore it as soon as possible.”

Pockit said it was working with the FCA to get the issue solved as quickly as possible.

On its website, Wirecard Card Solutions said: “Wirecard Card Solutions Limited (WDCS) has temporarily suspended its electronic money issuing, card issuing and acquiring business with immediate effect and until further notice.

“WDCS is working hard to have the steps in place which will enable the suspension to be lifted so business can resume as usual. We will provide further updates on our website as soon as we can.”

• Wirecard: Scandal-hit firm files for insolvency
• Wirecard: Former boss arrested over €1.9bn scandal

Funds are not protected, as they are in banks, by the Financial Services Compensation Scheme, but the firm said customers’ money was held safely in segregated accounts.

The FCA has told people affected to contact their card provider.

The action comes after the German parent firm Wirecard last week disclosed a €1.9bn (£1.7bn) hole in its accounts, and subsequently filed for insolvency.

Former boss Markus Braun has been arrested and accused of inflating Wirecard’s finances to make them appear healthier to investors and customers.

The Munich based firm employs almost 6,000 staff in 26 countries. The firm’s creditors stand to lose billions of euros from the scandal.

British Airways has told its longest-serving cabin crew they face a 20% cut in basic pay or they will lose their jobs.

The move is the airline’s latest offer in ongoing consultations with Heathrow-based staff.

In an email sent last night, British Airways said the aviation industry would look “very different” after the coronavirus pandemic.

Under the plan, long-serving cabin crew will need to re-sign under new terms.

The airline says the new terms will bring longer-serving, better paid staff in line with newer recruits who are on “market-competitive rates”.

• BA ground staff at Gatwick face redundancy
• British Airways: A breakdown in trust?

Like all airlines, BA has seen massive cuts in revenue as governments restricted travel to stop the spread of the coronavirus.

The airline has said up to 12,000 jobs could go from the 42,000 strong workforce, but consultations are continuing.

However, MPs have called BA’s plans “a national disgrace”.

A recent report by the Transport Select Committee accused the airline of a “calculated attempt to take advantage” of the pandemic by cutting thousands of jobs and downgrading terms and conditions.

Benefits ‘chipped away’

One cabin crew member who has worked for the airline since 1989, but did not want to give her name, told the BBC: “We know we make a profit but people are being offered new contracts which won’t allow them to pay their mortgages.

“They’ve chipped away allowances, holiday pay and even training,” she said.

“The new crew members are being taken on at a young age, but not given the training in service that we were.”

Currently the airline’s Heathrow-based cabin crew are divided into three fleets or teams: the Worldwide fleet for long haul flights, the Eurofleet for short haul and the Mixed fleet.

BA plans to move all three teams into a new catch-all fleet, arguing that will be more efficient and save the airline money.

‘Soft landing’

In the email to cabin crew, Amy James, BA’s Head of Inflight Customer Experience said the plans would have a “significant impact on staff currently earning significantly more then the current market rate”.

“Our proposal would guarantee that if you secure a corresponding role in our new team, we will safeguard your basic pay at at least 80% of your current rate.

“This pay protection proposal provides a ‘soft landing’ into a new aviation industry that’s very different to what any of us have known in the past.”

However, cabin crew who have spoken to the BBC have pointed out that much of what they earn comes in the form of variable allowances – paid on top of their basic salary – which are due to be replaced under the new scheme.

It is not clear how much they will be reduced. There are also likely to be significant changes to other terms and conditions.

Sources close to the company say staff should not see their pay cut by more then 30%.

British Airways has now promised that cabin crew will not lose more than 20% of their basic pay. It looks like a concession – there had been talk of cuts exceeding 60% – but how soft is the “soft landing” being promised by managers?

It isn’t entirely clear. Basic pay is just one part of a cabin crew member’s earnings. Staff on the so-called “legacy fleets” based at Heathrow make a significant chunk of their overall earnings from variable allowances.

These will certainly change under the cost-cutting plan, but it isn’t yet clear what those changes will be. Other changes, to working patterns for example, are also likely to have a major impact on everyday life for many staff.

Company insiders suggest no-one will see a pay cut of more than 30% overall – and many lower-paid staff, particularly those who joined over the past 10 years, should see their earnings increase. They say cost-cuts are vital if the airline is to prosper in future.

But the threat to staff remains – if an agreement on the changes can’t be reached, the company will force the issue – by handing staff their notice and offering them new contracts under different terms.

It’s because of that threat that Unite and GMB are refusing to engage with the company. It has also, all too clearly, alienated many staff.

This offer may be an attempt to pour oil on troubled waters, but the reaction so far suggests it’s unlikely to be effective.

Many of the Worldwide and Eurofleet staff joined BA years ago, before low-cost carriers such as Ryanair and Easy Jet disrupted the aviation sector.

The Mixed fleet was set up in 2010 after a bitter dispute between BA and unions.

Unite and the GMB are not engaging in talks with BA, which is owned by the IAG airline group.

In 2019, IAG reported a profit of €1.7bn (£1.54bn).

The owner of some of the UK’s biggest shopping centres, Intu, has warned that it is likely to call in administrators.

The firm, which owns the Trafford Centre, the Lakeside complex, and Braehead, said it had not reached an agreement in financial restructuring talks with its lenders.

Its centres are expected to stay open if it falls into administration, at least in the short term.

Intu has already warned that longer term some of its centres may close.

The company is the UK’s biggest shopping centre group, with 17 centres in the UK and three in Spain.

Should Intu fall into administration, the shopping centres are likely to remain open while the administrators decide what course of action they want to take.

Options will include trying to sell the centres on to other potential buyers.

Retail analyst Richard Hyman said he expected that most of Intu’s shopping centres “will live to fight another day”.

“Possibly not all, but most,” he said. “There are some very good and important centres in Intu’s portfolio.”

Intu had been struggling even before the coronavirus outbreak, and about 132,000 jobs in the company and in its wider supply chain will be in question should the firm fall into administration.

Retail expert Kate Hardcastle said one area of concern was Intu’s £4.5bn debt, given the declining value of its shopping centres.

They “just aren’t worth the value they once were”, she told BBC Breakfast.

While the coronavirus crisis forced the closure of all non-essential shops, retailers had already been under pressure from a host of factors including changes in shopping habits as people move online.

Big shopping centre landlords such as Intu rely on big retailers for their revenues – but in recent years retailers have been asking landlords for rent reductions due to the pressures they are under, Ms Hardcastle said.

Coronavirus effects

Mr Hyman said that retailers were already under pressure before the coronavirus pandemic, and had too much floor space.

The pandemic had then speeded up a shift to online shopping.

“What would have taken five years to evolve – we’re seeing that happen now,” he said.

“People have been forced to shop online. When the dust settles, some of that spend will come back to physical stores – but not all of it will.”

Intu’s centres were partially shut during the coronavirus lockdown, with only essential shops remaining open. The company had about 60% of shopping centre staff and about 20% of head office employees on furlough.

In its update to investors on Friday, Intu said it had failed to reach agreement in discussions with lenders on so-called “standstill” terms, under which it would look to defer interest payments on its large and complex debts.

It was also seeking agreements from its wide range of creditors, from big banks to hedge funds, for them not to take action if it breached certain terms on its loans.

Intu has already lined up administrators KPMG as a “contingency”.

Tesco says that customers have been buying more food during fewer shopping trips amid the coronavirus pandemic.

The supermarket said that while the number of trips made by shoppers fell nearly a third in the 13 weeks to 30 May, the amount being bought rose 64%.

In a trading update, Tesco said group sales had risen 8% to £13.4bn in the period, but warned coronavirus-related costs were set to hit £840m this year.

Boss Dave Lewis said it had been “a very challenging period for everyone”.

Like many of its rivals, Tesco was forced to overhaul its strategy in-store and online amid the coronavirus lockdown.

Coronavirus-related costs

Its chief executive Mr Lewis said: “In just five weeks, we doubled our online capacity to help support our most vulnerable customers and transformed our stores with extensive social distancing measures so that everyone who was able to shop in store could do so safely.”

The supermarket says that it saw a substantial increase in costs as a result. They stemmed from offering 12 weeks’ paid leave to 26,000 vulnerable workers and recruiting 47,000 temporary staff to cover sickness and meet demand.

Across its UK & Ireland business, sales rose by 9.2% in the three months to 30 May. Online sales mainly drove the increase, jumping by 48.5% in the quarter.

As more customers turned to online shopping, the firm ramped up online delivery slots and is now fulfilling more than 1.3 million online order per week.

In UK stores, food sales also increased by about 12% as customers “focused more on the purchase of their essential items”.

But Mr Lewis said that coronavirus-related costs were “only partly off-set” by the sales boost and business rates relief.

Tesco benefitted from the tax holiday worth about £532m offered to shops in England, Scotland and Northern Ireland.

The company also warned that Tesco Bank was expected to make a loss this year, as a result of the expected downturn in the economy following the coronavirus lockdown measures.

Tesco said it had increased its provision for potential bad debts, and now expected the bank to report of loss of between £175m and £200m in the current financial year.

Crowded market

Neil Shah, director of research at Edison Group said that Tesco had “clearly benefited from their revised strategy, helping them restore confidence in the group”.

But he urged some caution: “Investors should keep a close eye on the company, since the group operates in a crowded market with retailers Aldi and Lidl continuing to gain market share and current results might not be replicated when the UK is lifted from lockdown.”

In response to increasing pressure from budget retailers, Tesco introduced an “Aldi price match” promise in March. On Friday it said it would extend the offer to nearly 500 Tesco products.

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The trading update came ahead of the company’s annual general meeting, where it is expected to face a shareholder revolt over its pay rules and plan to hand the outgoing boss a £6.4m pay deal.

Its executives saw pay boosted last year after online supermarket Ocado was removed from a calculator used to set bonuses.

Dave Lewis would have missed out on free shares worth about £1.6m if Ocado had stayed on a list used to compare rivals’ success. Ocado’s sharp share price rise meant Tesco would have underperformed in a benchmark comparing performance.

Tesco said at the time that Ocado was no longer relevant as it was now a technology business.

Virgin Australia has been bought by US private equity group Bain Capital after falling into administration due to coronavirus travel restrictions.

The airline was struggling with long-term debt of A$5bn (£2.55bn; $3.17bn) even before the pandemic struck.

Australia’s second biggest carrier had unsuccessfully asked for government loans before its collapse in April.

Virgin Australia is currently owned by a number of major shareholders including Sir Richard Branson.

Administrators for the airline, Deloitte, said on Friday that Bain would become the new owners, with the deal expected to be completed by the end of August.

A statement said Bain supports the airline’s current management team and its turnaround plan for the business. It has also committed to retain thousands of jobs.

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In addition, a “significant injection of capital” would be made to help Virgin Australia recapitalise for the future, according to the statement.

Bain and another US firm, Cyrus Capital Partners, had been in the running to buy the airline before Cyrus pulled out on Friday.

“Bain Capital has presented a strong and compelling bid for the business that will secure the future of Australia’s second airline, thousands of employees and their families and ensure Australia continues to enjoy the benefits of a competitive aviation sector,” Deloitte said in the statement.

A win for the government

Simon Atkinson, BBC News, Sydney

While there was plenty of interest in buying Virgin Australia, there’ll still be sighs of relief in the corridors of power that the airline has a new owner.

For the government this is a win. Virgin was saved without state intervention and the prospect of a Qantas monopoly has been avoided.

In the short term – if and when state borders open up – there’ll be pent up demand at both airlines (and their cut-price subsidiaries) from people desperate to fly around Australia to see family, do deals or have a holiday at home instead of abroad.

But Australia is in its first recession in almost three decades. Record unemployment and the inevitable tapering of Covid-19 welfare payments mean there’ll soon be limited dollars floating around for people to spend.

And the success of video conferencing will be making cash-strapped firms reconsider those Sydney-Melbourne business trips that have been the proverbial cash cow for both Qantas and Virgin.

So it’ll be interesting to see how the two airlines compete and, given they’re both flush with new investment, whether they go down the path of a price war.

Other than Sir Richard, Virgin Australia is currently owned by a number of shareholders including Singapore Airlines, the UAE government and China’s HNA airline.

Sir Richard has said he will sell a stake in his Virgin Galactic space tourism business to support his other businesses, including Virgin Atlantic. He also put up his luxury Necker Island as collateral to help secure a government loan.

On Thursday rival airline Qantas said it will axe 6,000 jobs as part of its plans to survive the coronavirus pandemic.

With coronavirus travel restrictions still in place in many countries, British consumers are struggling to work out whether they can have a holiday this summer.

After much deliberation, social worker Pat Kelly has decided to take his family just two and a half hours away up to a campsite in northeast Scotland in a caravan.

“The idea of sitting in a plane at the moment doesn’t really appeal,” says Mr Kelly, who had originally saved up for a holiday to Ireland for the Galway 2020 Capital of Culture celebrations.

The Scottish resort Lossiemouth has many facilities such as a bar, a swimming pool and a kids’ play area that are unlikely to be open, but the family doesn’t mind, as they had thought they wouldn’t be able to get away at all.

“The idea of being somewhere new and different after several weeks of lockdown is making us all pretty happy,” he says.

The family is keen not to upset locals, although they hope that at least some places will be open when they visit.

“People in tourist spots will be nervous as the industry starts up again, but that needs to be balanced with the fact our visit will help sustain local businesses, such as boat trips and ice cream shops.”

But not everyone has the confidence to leave their homes this summer.

Staying at home

“We’re not going anywhere this summer,” digital PR consultant Julie Thompson Dredge tells the BBC.

“That’s mainly because I have severe asthma so have been shielding for a few months, and I don’t think it’s safe to go on public transport of any kind.”

With two young children, she and her husband worry about the additional time it might take to travel through airports.

“The effort of having to sanitise a two-year-old and a four-year-old constantly would just be a major headache,” she says.

Fortunately, the family has recently moved to a house in the country in Hampshire, which they’re planning to enjoy a bit more over the summer months when lockdown rules ease.

“We’ve been doing it up bit by bit and we’re excited to hopefully be able to entertain a few people at our place – as we’ve hardly been able to show anyone our new house since we moved here in February from London.

“We’re also near woods and lots of big spaces where the kids can enjoy themselves.”

Other people are still hoping they will be able to travel abroad, such as finance manager Tracy McLaughlin.

Like many other Brits she’s anxiously waiting to hear whether travel restrictions will be eased in time for a sunshine break abroad, and has already had two trips cancelled since lockdown started in March.

“We’re feeling positive and have booked a five-bedroom villa and flights for the whole family in August,” says Ms McLaughlin.

“The villa is free cancellation until 22 July so hopefully by then everything will be clearer.”

Restrictions for most European countries are expected to be lifted in early July, with an announcement expected in the next couple of days.

At present anyone who goes overseas faces two weeks of self-isolation when they return home.

Ms McLaughlin was originally only planning to go to Cyprus with her husband Taz, but she has missed her family so much that she has now booked additional flights for their four grown-up children and one of their partners.

“It’s a great excuse for a big family holiday as we have been apart so much,” she says. “Also my youngest is joining the army soon so this will be the last time we will be able to do this.”

The couple have booked the new flights with British Airways, which come with a guarantee of a voucher valid for two years if the flight is cancelled.

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There is no guarantee that they will be able to make it to Cyprus, but they are crossing their fingers.

“We’re waiting to hear whether Cyprus will open its doors to us but we thought it was definitely a risk worth taking,” says Ms McLaughlin.

Should I have travel insurance?

It’s always a good idea to have travel cover but there’s a big caveat this summer: travel insurers won’t pay out for coronavirus-related cancellations.

That’s why, if you’re making a booking now, you need to check hotels’ and airlines’ cancellation policies carefully.

However, some policies may cover you if you or a family member catches coronavirus before you travel, and you have to cancel, as a result of the illness.

It’s crucial ask insurers if they’ll offer you that cover and shop around if you want it.

If you have a pre-booked trip that you’ve already taken out cover for, then it may cover you for cancellation due to coronavirus travel restrictions, but only if you took it out before the Foreign Office warned against non-essential travel in March.