American Airlines in ‘fight of our lives’ as it plans more coronavirus cuts
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American Airlines president Robert Isom called the carrier’s efforts to survive the novel coronavirus pandemic the “fight for our lives” in a memo unveiling plans for further staff and flying reductions.
The Fort Worth, Texas-based carrier will cut its domestic schedule by 30% in April with deeper cuts coming in May, Isom told employees in the communiqué Thursday. The reductions are on top of the 75% cut to American’s international schedule that will leave it with just three long-haul routes through at least May.
As part of the effort to match capacity to demand and cut spending, American is offering voluntary leave to most union staff and an early-retirement option for employees with more than 15 years at the airline.
“We are in the fight of our lives, and we will win,” said Isom.
American’s deeper schedule cuts were expected. Its largest competitors, Delta Air Lines and United Airlines, have both cut system capacity far more by 70% and 60%, respectively. All three are moving to respond to the plummeting demand for air travel as people stay home among calls to slow the spread of COVID-19.
All of the reductions are having ripple effect on the industry. Regional affiliate Compass Airlines will shut down on April 7 due to American’s latest cuts, and Trans States Airlines will close its doors on April 1 due to United’s reductions. The moves will leave thousands of staff at both regional carriers jobless as the larger U.S. economy slows.
“This is devastating,” Association of Flight Attendants-CWA president president Sara Nelson told TPG. “If the government doesn’t act fast we’re going to see more casualties.”
The AFA represents cabin crew at 20 airlines, including Compass.
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U.S. carriers have asked the government for at least $50 billion in aid to get through the crisis. Funds would help the bridge the cash crunch many face as revenues dry up.
At American, Isom told employees that “each dollar matters.” The airline closed a new $1 billion loan to shore up its balance sheet on March 18.
American CEO Doug Parker is in Washington, D.C., working to secure an aid package, added Isom.
The carrier will park around 450 of its 1,547 jets — 942 mainline and 605 regional at the end of December — with the schedule cut. This includes retiring its Boeing 757 and 767 fleets early.
Featured image by Chip Somodevilla/Getty Images.
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