Allegiant, JetBlue and Spirit Airlines latest US carriers to cut flights and CEO pay
Allegiant Air, JetBlue Airways and Spirit Airlines are slashing schedules even further amid plummeting demand related to spread of the novel coronavirus pandemic in the U.S.
New York-based JetBlue will reduce capacity by at least 40% in both April and May, and expects "substantial cuts" through at least July, CEO Robin Hayes and president Joanna Geraghty told employees on Wednesday.
South Florida-based Spirit will reduce its schedule by 20% in April and by 25% in May, CEO Ted Christie told employees in a letter on Tuesday.
Allegiant, headquartered in Las Vegas, plans to cut capacity by up to 35% in April and May, up from current reductions of 15%, the airline said Wednesday. It has also suspended construction of its Sunseeker Resort project in Florida.
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Executives at all three airlines cited rapidly falling demand, which Christie described as falling to "unprecedented lows," for each carriers' capacity cuts.
The cuts by the carriers are just the latest to hit an industry roiled by a precipitous drop in demand related to the pandemic.
Alaska Airlines, American Airlines, Delta Air Lines, Southwest Airlines and United Airlines have also slashed schedules amid the spread of COVID-19. United regional affiliate Trans States Airlines will cease flying on April 1 due to the crisis, eight months earlier than planned due to the coronavirus-related drop in demand.
Related: Trans States Airlines to shut down April 1, first US carrier to close amid coronavirus crisis
Both JetBlue and Spirit had already announced capacity cuts due to the COVID-19 crisis. JetBlue planned a 5% reduction in the "near term," and Spirit an at least 5% cut in April. Both carriers said they would cut further if the crisis worsened.
And worsened it has. Several U.S. carriers have cited passenger loads as low as 20% to 30% in March. Comparatively, average load factors across domestic airlines was 85.5% in March 2019, according to U.S. Bureau of Transportation Statistics data.
Industry organization Airlines for America (A4A) has asked the U.S. government for at least $50 billion in aid to get the industry through the crisis.
Related: US airlines seek at least $50 billion in aid to combat coronavirus crisis
Along with the capacity cuts, executives at Allegiant, JetBlue and Spirit are either taking salary cuts for the duration of the pandemic. Allegiant CEO Maurice Gallagher and president John Redmond are forgoing their salaries, while officers have halved their salaries.
At JetBlue, Hayes and Geraghty have halved their salaries and all staff at the vice president level and above are taking cuts. And at Spirit, Christie has reduced his salary by 30% and other executives are also taking pay cuts.
The reductions in pay are, in part, coupled with the effort by airlines to conserve cash. It is critical for all companies, including airlines, to have cash to pay their bills even as revenues dry up during the crisis. This coronavirus-related cash crunch is occurring at airlines around the world.
JetBlue, in addition to its other actions, is grounding some of its 259 Airbus and Embraer jets, Hayes and Geraghty said. The airline has also postponed the planned addition of four leased Airbus A321s, and is in talks with Airbus to postpone new A220 and A321neo deliveries.
Related: US airlines could retire older aircraft, focus on newer models due to coronavirus downturn
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- Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 3X Membership Rewards® points per dollar spent on flights booked directly with airlines or on AmexTravel.com.
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Rewards Rate
| 4X | Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year. |
| 4X | Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year. |
| 3X | Earn 3X Membership Rewards® points per dollar spent on flights booked directly with airlines or on AmexTravel.com. |
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Intro Offer
You may be eligible for as high as 100,000 Membership Rewards® Points after spending $6,000 in eligible purchases on your new Card in your first 6 months of Membership. Welcome offers vary and you may not be eligible for an offer.As High As 100,000 points. Find Out Your Offer.Annual Fee
$325Recommended Credit
Credit ranges are a variation of FICO® Score 8, one of many types of credit scores lenders may use when considering your credit card application.Excellent to Good
Why We Chose It
There’s a lot to love about the Amex Gold. It’s a fan favorite thanks to its fantastic bonus-earning rates at restaurants worldwide and at U.S. supermarkets. If you’re hitting the skies soon, you’ll also earn bonus Membership Rewards points on travel. Paired with up to $120 in Uber Cash annually (for U.S. Uber rides or Uber Eats orders, card must be added to Uber app and you can redeem with any Amex card), up to $120 in annual dining statement credits to be used with eligible partners, an up to $84 Dunkin’ credit each year at U.S. Dunkin Donuts and an up to $100 Resy credit annually, there’s no reason that foodies shouldn’t add the Amex Gold to their wallet. These benefits alone are worth more than $400, which offsets the $325 annual fee on the Amex Gold card. Enrollment is required for select benefits. (Partner offer)Pros
- 4 points per dollar spent on dining at restaurants worldwide and U.S. supermarkets (on the first $50,000 in purchases per calendar year; then 1 point per dollar spent thereafter and $25,000 in purchases per calendar year; then 1 point per dollar spent thereafter, respectively)
- 3 points per dollar spent on flights booked directly with the airline or with amextravel.com
- Packed with credits foodies will enjoy
- Solid welcome bonus
Cons
- Not as useful for those living outside the U.S.
- Some may have trouble using Uber and other dining credits
- You may be eligible for as high as 100,000 Membership Rewards® Points after you spend $6,000 in eligible purchases on your new Card in your first 6 months of Card Membership. Welcome offers vary and you may not be eligible for an offer. Apply to know if you’re approved and find out your exact welcome offer amount – all with no credit score impact. If you’re approved and choose to accept the Card, your score may be impacted.
- Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 3X Membership Rewards® points per dollar spent on flights booked directly with airlines or on AmexTravel.com.
- Earn 2X Membership Rewards® points per dollar spent on prepaid hotels and other eligible purchases booked on AmexTravel.com.
- Earn 1X Membership Rewards® point per dollar spent on all other eligible purchases.
- $120 Uber Cash on Gold: Add your Gold Card to your Uber account and get $10 in Uber Cash each month to use on orders and rides in the U.S. when you select an American Express Card for your transaction. That’s up to $120 Uber Cash annually. Plus, after using your Uber Cash, use your Card to earn 4X Membership Rewards® points for Uber Eats purchases made with restaurants or U.S. supermarkets. Point caps and terms apply.
- $84 Dunkin' Credit: With the $84 Dunkin' Credit, you can earn up to $7 in monthly statement credits after you enroll and pay with the American Express® Gold Card at U.S. Dunkin' locations. Enrollment is required to receive this benefit.
- $100 Resy Credit: Get up to $100 in statement credits each calendar year after you pay with the American Express® Gold Card to dine at U.S. Resy restaurants or make other eligible Resy purchases. That's up to $50 in statement credits semi-annually. Enrollment required.
- $120 Dining Credit: Satisfy your cravings, sweet or savory, with the $120 Dining Credit. Earn up to $10 in statement credits monthly when you pay with the American Express® Gold Card at Grubhub, The Cheesecake Factory, Goldbelly, Wine.com, and Five Guys. Enrollment required.
- Explore over 1,000 upscale hotels worldwide with The Hotel Collection and receive a $100 credit towards eligible charges* with every booking of two nights or more through AmexTravel.com. *Eligible charges vary by property.
- No Foreign Transaction Fees.
- Annual Fee is $325.
- Terms Apply.