UK ground-handling firms have collectively urged the government to take measures to help them preserve cash and maintain their workforce, warning that they will otherwise be unlikely to maintain operations through the coronavirus crisis period.
In a letter to UK chancellor Rishi Sunak and transport secretary Grant Shapps, four major handling companies – Swissport, Dnata, Menzies and WFS – are seeking “urgent dialogue” to obtain support.
The four companies represent 90% of handling services for passenger and cargo flights at UK airports, with a collective workforce of 25,000 in the country. Retention of staff is crucial, they argue, because of the time needed to hire and train new personnel.
“Without our services and these dedicated teams, the airport infrastructure in the UK would grind to a halt for up to four months,” they write. “It would take even longer to fully recover once the initial crisis is over.”
Coronavirus disruption risks an “artificial cash-flow crisis”, they state, posing a “very real threat” to survival of “ordinarily healthy businesses”.
“Our industry operates a low-margin model. We are generally paid on a per-service basis or tonnage, so where flights are grounded, our provision is cancelled and our revenue is cut off,” they point out.
Menzies disclosed on 27 March that it was putting more than half its global workforce on temporary leave.
Routine decisions, they warn, such as the purchase of de-icing fluid ahead of forecast cold weather, are becoming “harder to make”.
The handlers have asked the government to consider national insurance and tax breaks, removal of business rates, access to emergency funding, and provision of guarantees to lenders in order for them to continue funding the aviation industry.
“Without urgent government support we are unlikely to be able to continue our operations across the country throughout the crisis period,” they write, adding that handlers have not been included in government discussions over the aviation sector. “The more staff we lay off, the greater the challenge we will face in servicing the bounce-back and corresponding national economic recovery once [this] crisis is over.”