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Aviation is one of the sectors most economically affected by the crown crisis. Now the financial construction of the fuel coverage will be its fall, Ö1 reported. Low-cost airline Wizz Air suffered a loss of up to € 80 million in the first quarter, and Lufthansa also expects losses.
Fuel coverage is a procedure against fluctuating kerosene prices. The kerosene purchase price is set months in advance over a certain period of time. If the price of fuel changes, for example, it becomes more expensive, the airline still pays the specified amount. Since the price of oil is so low right now, it will be the downfall of the airlines.
According to Ö1, Hungarian low-cost airline Wizz Air suffered a loss of up to € 80 million in the first quarter of 2020 simply due to failed fuel coverage. The German group Lufthansa, to which AUA (Austrian Airlines) belongs, also expects “coverage” losses.
It was recently announced that Lufthansa CEO Carsten Spohr hopes to cut 10,000 jobs in the crown crisis. The fleet will be reduced by about 100 planes, the CEO said last week. (apa / red)
