Swiss airlines to get almost CHF2 billion corona aid boost
Swiss International Air Lines is a subsidiary of German group Lufthansa.
Keystone / Ennio Leanza
The Swiss aviation sector, including the airlines SWISS and Edelweiss, is set to receive financial aid of almost CHF1.9 billion to help it through the liquidity crisis caused by Covid-19.
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Some CHF1.275 billion ($1.31 billion) is directly for the two airlines, while up to CHF600 million will be for other companies vital to the functioning of the sector, the government announced on WednesdayExternal link.
Parliament still needs to sign off on the package.
Transport Minister Simonetta Sommaruga explained the move at a press conference in Bern, stating that aviation was part of the country’s “critical infrastructure”: over one-third of Switzerland’s exports leave by air, while one-sixth of imports come by air, she said.
The aid, first mooted by Sommaruga three weeks ago, comes with strict conditions, primarily that the funds used are only to be used for Swiss infrastructure.
And while SWISS – a subsidiary of German group Lufthansa – and Edelweiss will benefit, EasyJet Switzerland will not, and must look to its British parent company to solve its liquidity issues, the government wrote.
Likewise, the Swissport and Gategroup companies, which operate services, logistics, and catering for the aviation industry, are not directly eligible, since they are internationally active and majority-owned by Asian investors.
The government said that future earnings by SWISS and Edelweiss should be prioritized to repay the aid, while dividends and other such payments will be forbidden until this is done.
It also said that it was not seeking an ownership stake in the airlines as part of the package, although it added that the loans would be secured by SWISS and Edelweiss shares.
Lufthansa, Europe’s biggest carrier by revenue, is currently in talks with the German government about a 9 billion euro ($9.77 billion) rescue plan, Reuters has reported sources as saying.
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