American Airlines Struggling but Promises Not to Halt Service

The US leading air carrier, American Airlines Inc. (American Air) announced on Thursday, April 2, 2020, that it is planning to reduce its operational capacity substantially for this summer but has considered not to put its services on hold amid the coronavirus pandemic. Like other airline companies, American Air had been hit badly because of the government’s restrictions on movements and a sharp decline in the demand for air travel across the globe due to the virus outbreak.

Reducing but Not Cease

With the sharp decline in demand for air travel both domestic and international flights, American Air has decided to reduce its operations for some more months. Vasu Raja, American Airlines’ senior vice president of Network Strategy, told Reuters that the airline aimed at cutting its flight capacity between 70% and 75% in April and about 80% in the month of May. Till May, the airline would also cut off nearly 90% of its international flights.

Nevertheless, the US airline expressed its position that it would not halt its operation despite the existing challenges of dipping revenues of its services. Citing the services are reserved for medical workers and their urgent travel, Raja said, “We are making no plans for the cessation of flying.”

He added, “The important thing is to provide a minimum level of essential service to customers … but we do it in such a way where we don’t burn an excessive amount of cash.”

American Air officials also disclosed on Thursday that it had to suspend more than 60% of its total international flights this summer, including an 80% reduction in Pacific capacity, a 65% reduction in Atlantic, and a 48% reduction in Latin America. The US airline company had to delay the launch of new international routes until 2021, of new winter seasonal service, and of 25 summer seasonal flights.

Troubles of US Airline Industry

According to a source, the harsh impact of the virus outbreak on the US aviation industry has resulted in a sharp decline in the overall US flight operations about 50% to 70% at some major airports. Till Wednesday, the flow of air passengers in the US airports reduced a record low at around 136,023 from 2.2 million a year ago.

Reuters reported, “American Airlines will go from the pre-crisis typical 250-weekday flights from Washington Reagan National Airport to about 28 in May.” Similarly, the service of the company will reduce from close to 100 flights a day at New York’s John F. Kennedy International Airport to just 11 flights a day. At its Dallas-Fort Worth hub, American Air would decline from nearly 1,000 planned flights a day this summer to around 350.

Citing the low demand for travel, Raja said, “If we are the bottom it is only because gross bookings have fallen to zero and they can’t go any lower than that… Pretty soon we’ll even run out of people to cancel on U.S. airlines.”

American Air declared that it would only cease its A330 fleet operation through the end of the summer to conserve costs. Meanwhile, the US airline company has been seeking a rescue package of $12 billion out of $50 billion available in US government loans and grants for the airline industry.

I’m Roshan, a journalist, blogger and music lover. I like covering global news related to finance, business, and technology. Focusing on the collection of true and reliable information, I rely on working by conducting interviews with business leaders and talking to the inside sources of companies.

You can reach out to me at: [email protected]

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