Ryanair plans to ground the majority of its fleet across Europe over the next seven to ten days and said it will have to make significant reductions to working hours and payments.
The airline said that over the past week, the spread of Covid-19 and associated government travel restrictions have had a significant and negative impact on its schedules.
Ryanair noted that over the past week, Italy, Malta, Hungary, Czech Republic, Slovakia, Austria, Greece, Morocco, Spain, Portugal, Denmark, Poland, Norway and Cyprus have imposed flight bans of varying degrees.
The airline said it expects the result of these restrictions will be the grounding of the majority of its aircraft fleet across Europe over the next seven to ten days.
In those countries where the fleet is not grounded, social distancing restrictions may make flying to all intents and purposes, impractical, if not, impossible, it added.
Ryanair said it now expects to reduce its seat capacity by up to 80% for April and May, adding that a full grounding of the fleet cannot be ruled out.
It also said it is taking immediate action to reduce operating expenses and improve cash flows.
This will involve grounding surplus aircraft, deferring all capital expenditure and share buybacks, freezing recruitment and discretionary spending.
Ryanair also said it will implementing a series of voluntary leave options, temporarily suspending employment contracts, and significant reductions to working hours and payments.
"We are working with our people and our unions across all EU countries to address this extraordinary and unprecedented Covid-19 event, the impact and duration of which is, at this time, impossible to determine," the airline said.
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In a statement today, Ryanair said that it has strong liquidity, with strong cash and cash equivalents of over €4 billion as at 12 March.
It said its focus now is on completing as much of the scheduled flying programme as is permitted over the next seven days, so that it can repatriate customers, where possible, even as flight bans are imposed and air traffic control and essential airport services are reduced.
"We have seen a substantial decline in bookings over the last two weeks, and we expect this will continue for the foreseeable future," Ryanair said.
"We will continue to monitor demand, as well as government flight restrictions, and we will continue to make further cuts to schedules as necessary," it added.
Ryanair's chief executive Michael O'Leary said the airline is taking all actions necessary to cut operating expenses, and improve cash flows at each of its airlines.
"Ryanair is a resilient airline group, with a very strong balance sheet, and substantial cash liquidity," Mr O'Leary said.
"We can, and will, with appropriate and timely action, survive through a prolonged period of reduced or even zero flight schedules, so that we are adequately prepared for the return to normality, which will come about sooner rather than later as EU Governments take unprecedented action to restrict the spread of Covid-19," he added.
The Ryanair CEO said the airline is doing everything it can to meet the challenge posed by the Covid-19 outbreak.
Ryanair is communicating with all affected passengers by email and SMS, and it is also organising rescue flights to repatriate customers, even in those countries where travel bans have been imposed.
"Our priority remains the health and welfare of our people and our passengers, and we are doing everything we can to ensure that they can be reunited with their friends and families during these difficult times," Mr O'Leary said.
Ryanair also said today it was removing the fee for changing flights on all bookings for April.
The airline said its customers can now move their flight free of charge to a date in the future.
It said the flight change fee will be waived in full and customers will only have to pay the difference in fare.
But it advised customers not to try to change to another date in April as it earlier predicted that most of its flights will still be grounded by then.
Shares in the company slumped in Dublin trade today.