British Airways retires its entire fleet of Boeing 747s with immediate effect

British Airways said on Friday that it has decided in favour of retiring its entire fleet of Boeing 747s with immediate effect as the Coronavirus pandemic curbed demand for air travel and brought the global airline industry to a near halt in recent months. The British flagship air carrier that is a subsidiary of International Consolidated Airlines Group (LON: IAG) has the largest fleet of Boeing’s jumbo jets in the world.

Shares of IAG opened about 1% down on Friday and tanked another 2.5% on market open. At 220 pence per share, the Anglo-Spanish airline holding company is currently 65% down year to date in the stock market after recovering from an even lower 168 pence per share in May. It is valued at £4.36 billion and has a price to earnings ratio of 2.87.

British Airways had originally planned to retire jumbo jets in 2024

Originally, British Airways had plans of retiring its fleet of 747s in 2024. Owing to the outbreak of the novel flu-like virus, however, that has so far infected a little under 300,000 people in the United Kingdom and caused more than 45,000 deaths, the airline is now resorting to retiring it earlier as passenger numbers are being forecast to take years before returning to the pre-virus levels.

According to the air carrier, the newer planes now offer an advantage of significantly better fuel efficiency that it makes it costlier for airlines to operate the Boeing 747s. British Airways said on Friday:

“it is with great sadness that we can confirm we are proposing to retire our entire 747 fleet with immediate effect. While the aircraft will always have a special place in our heart, as we head into the future, we will be operating more flights on modern fuel-efficient aircraft such as our new A350s and 787s.”

British Airways to layoff 28% of its workforce

The novel challenges raised by COVID-19 crisis in recent months pushed British Airways into considering laying off 28% of its workforce that represents roughly 12,000 jobs to bolster liquidity. British Airways will auction up to £1.36 million of art to further shore up finances.

The air carrier also announced to have inked an agreement in June with its pilots that will see 350 of them losing jobs while an additional 300 will be placed in a pool and are expected to be rehired once the demand kicks in. The pool, however, comprised primarily of pilots that were likely to serve as 747s first officers.