Skip to content

US carriers signal slow recovery with United Airlines planning to cut June flying by 90%

April 20 2020
6 min read
US carriers signal slow recovery with United Airlines planning to cut June flying by 90%
This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

It may be time to start rethinking summer travel plans, especially if they involve flying somewhere.

United Airlines may fly about 525 flights a day in June, according to a securities filing Monday and Cirium schedule data. That's just 10% of the schedule it flew globally in June 2019, and equal to about what it had planned to fly daily from just its Denver (DEN) hub this summer.

"The U.S. consumer does not yet appear to be contemplating travel (either domestic or international)," wrote Raymond James analyst Savanthi Syth in a report on April 19 summing up the situation airlines face as they head into the summer travel season.

Sign up for our daily newsletter

Get Coronavirus travel updates. Stay on top of industry impacts, flight cancellations, and more.

 

View this post on Instagram

 

Parked United planes as far as the eye can see... #united #unitedairlines #dulles #travel #DC #airport #avgeek

A post shared by Chad (@chadbrochill88) on

United's likely 90% capacity cut in June is the most of any U.S. airline to date. American Airlines hopes to reinstate some international services and resume some domestic flying after up to 90% cuts in May, and Southwest Airlines plans to fly about half its schedule, or 2,000 daily flights, in June.

But all indications suggest that United's deep cuts may be needed as much of the U.S. remains under lockdown as the coronavirus pandemic continues to spread across the nation. Only five states -- Arkansas, Iowa, Nebraska, North Dakota and South Dakota -- do not have statewide orders asking residents to stay home, according to The New York Times.

The latest data from industry organization Airlines for America (A4A) shows net bookings, or new reservations minus cancellations, down more than 98% year-over-year during the week ending April 12. The data shows net bookings bottoming out over the past week or so.

Related: United Airlines loses $2B in first reported US airline coronavirus-crisis losses

Raymond James sees a similar trend. Syth wrote Sunday that demand appears to have stabilized at "bottomed out levels."

But bottoming out -- and it's hard to go much lower than bookings down 98% -- does not mean a recovery is at hand.

"We need to be prepared for a very prolonged, sluggish travel environment," said Southwest CEO Gary Kelly in a video message on April 13. "We're just going to have to learn patience."

Related: Southwest CEO says airline hopes to avoid furloughs, dropping cities

Similarly, Delta Air Lines CEO Ed Bastian has told staff not to expect a recovery until the traveling public feels that it is safe to fly again. Something he has cautioned could take until there is a vaccine for COVID-19, which optimistically would take at least a year to develop.

"I don’t know what that pace of recovery will be,” he said on April 8. “It will really be dictated based on when customers feel safe to travel again in large numbers.”

In other words, no one knows when non-essential travelers will take to the skies again in any kind of significant numbers -- not airline executives, nor industry watchers or even public health officials.

Wall Street analysts expect U.S. airlines to be at least 25% to 30% smaller by year-end than they were at the end of 2019. This downsizing will involve parking hundreds of aircraft and reducing workforces by potentially over 100,000 people across the industry.

We do not know how this will translate into what airlines look like when the recovery begins. But it is safe to say, there will be a lot fewer flights and probably fewer nonstop routes -- unless one lives in places like Atlanta, Chicago or Dallas -- for the foreseeable future.

Related: How will airlines rebuild their route maps after the coronavirus?

Featured photo by PA Images via Getty Images

TPG featured card

Best Marriott card for Business Owners
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
3 / 5
Go to review

Rewards

2 - 6X points
6X6x points at hotels participating in the Marriott Bonvoy® program.
4X4x points for purchases made at restaurants worldwide, at U.S. gas stations, on wireless telephone services purchased directly from U.S. service providers and on U.S. purchases for shipping.
2X2x points on all other eligible purchases.

Intro offer

Limited Time Offer: Earn 100,000 points75,000 points
Limited Time Offer: Earn 100,000 Bonus Marriott Bonvoy Points after spending $4,000 in purchases on your new Card in your first 3 months of Card Membership. Offer expires 11/2/22.

Annual Fee

$125

Recommended Credit

670-850
Excellent/Good
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.

Why We Chose It

The Marriott Bonvoy Business Amex is a stacked card with a rewards rate that will help you earn bonus points on everyday and business-related purchases. You'll earn 15 elite night credits each calendar year, and receive automatic Gold elite status. Finally, the free night award certificate with a redemption level of 35,000 points or less can get you hundreds of dollars in potential value each year.

Pros

  • 6x points on eligible purchases at hotels participating in the Marriott Bonvoy program
  • 4x points at restaurants worldwide, U.S. gas stations, wireless telephone services purchased directly from U.S. service providers and U.S. shipping
  • 2x points on all other eligible purchases
  • Earn a free-night award each card renewal month (up to 35,000 points)
  • Receive 15 elite night credits to jump-start status
  • Transfer Marriott points to 40+ airlines

Cons

  • Airline points transfer ratios are poor
  • Must spend $60,000 in a year for second free-night award
  • Limited Time Offer: Earn 100,000 Bonus Marriott Bonvoy Points after spending $4,000 in purchases on your new Card in your first 3 months of Card Membership. Offer expires 11/2/22.
  • 6x points at hotels participating in the Marriott Bonvoy® program.
  • 4x points for purchases made at restaurants worldwide, at U.S. gas stations, on wireless telephone services purchased directly from U.S. service providers and on U.S. purchases for shipping.
  • 2x points on all other eligible purchases.
  • Receive a 7% discount off standard rates for reservations of standard guest rooms at hotels that participate in the Marriott Bonvoy program when you book directly. Terms and Conditions Apply.
  • Receive 1 Free Night Award every year after your Card renewal month. Plus, earn an additional Free Night Award after you spend $60K in purchases on your Card in a calendar year. Awards can be used for one night (redemption level at or under 35,000 Marriott Bonvoy® points) at hotels participating in Marriott Bonvoy®. Certain hotels have resort fees.
  • Enjoy Complimentary Marriott Bonvoy Gold Elite Status with your Card.
  • Terms apply.
  • See Rates & Fees
Apply for Marriott Bonvoy Business® American Express® Card
at American Express's secure site
Terms & restrictions apply. See rates & fees
Best Marriott card for Business Owners
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
3 / 5
Go to review

Rewards Rate

6X6x points at hotels participating in the Marriott Bonvoy® program.
4X4x points for purchases made at restaurants worldwide, at U.S. gas stations, on wireless telephone services purchased directly from U.S. service providers and on U.S. purchases for shipping.
2X2x points on all other eligible purchases.
  • Intro Offer
    Limited Time Offer: Earn 100,000 Bonus Marriott Bonvoy Points after spending $4,000 in purchases on your new Card in your first 3 months of Card Membership. Offer expires 11/2/22.

    Limited Time Offer: Earn 100,000 points
    75,000 points
  • Annual Fee

    $125
  • Recommended 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.

    670-850
    Excellent/Good

Why We Chose It

The Marriott Bonvoy Business Amex is a stacked card with a rewards rate that will help you earn bonus points on everyday and business-related purchases. You'll earn 15 elite night credits each calendar year, and receive automatic Gold elite status. Finally, the free night award certificate with a redemption level of 35,000 points or less can get you hundreds of dollars in potential value each year.

Pros

  • 6x points on eligible purchases at hotels participating in the Marriott Bonvoy program
  • 4x points at restaurants worldwide, U.S. gas stations, wireless telephone services purchased directly from U.S. service providers and U.S. shipping
  • 2x points on all other eligible purchases
  • Earn a free-night award each card renewal month (up to 35,000 points)
  • Receive 15 elite night credits to jump-start status
  • Transfer Marriott points to 40+ airlines

Cons

  • Airline points transfer ratios are poor
  • Must spend $60,000 in a year for second free-night award
  • Limited Time Offer: Earn 100,000 Bonus Marriott Bonvoy Points after spending $4,000 in purchases on your new Card in your first 3 months of Card Membership. Offer expires 11/2/22.
  • 6x points at hotels participating in the Marriott Bonvoy® program.
  • 4x points for purchases made at restaurants worldwide, at U.S. gas stations, on wireless telephone services purchased directly from U.S. service providers and on U.S. purchases for shipping.
  • 2x points on all other eligible purchases.
  • Receive a 7% discount off standard rates for reservations of standard guest rooms at hotels that participate in the Marriott Bonvoy program when you book directly. Terms and Conditions Apply.
  • Receive 1 Free Night Award every year after your Card renewal month. Plus, earn an additional Free Night Award after you spend $60K in purchases on your Card in a calendar year. Awards can be used for one night (redemption level at or under 35,000 Marriott Bonvoy® points) at hotels participating in Marriott Bonvoy®. Certain hotels have resort fees.
  • Enjoy Complimentary Marriott Bonvoy Gold Elite Status with your Card.
  • Terms apply.
  • See Rates & Fees