US airlines to cut more routes unless extra federal support arrives

Aaron Karp October 20, 2020

The heads of IATA and Airlines for America (A4A) painted a sober picture of the state of the airline industry, conceding the COVID-19 crisis is unprecedented for commercial aviation and warning of a potentially slow recovery.

This is the “deepest crisis” airlines have ever faced, IATA DG and CEO Alexandre de Juniac told the Flight Safety Foundation’s virtual International Air Transport Summit on Oct. 19. Airline employment around the world “will decline by a third,” he said.

A4A president and CEO Nicholas Calio, also speaking at the conference, noted that “a mere seven months ago we were in the golden age” of the US airline industry “and it all disappeared in two weeks.”

US airlines “are resilient,” he said. “They took a lot of self-help measures. We got a lifeline through the first CARES Act” from the US government enacted last spring. But CARES Act funding expired at the end of September and airlines will have to cut routes if more assistance from the US Congress is not forthcoming," Calio said.

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“You can’t keep flying to all these places” with traffic demand so low, he said, adding: “We think the uptick [from COVID-19] will be slower than we initially thought because we have a very uncooperative virus” that appears to be surging back in the US. Airlines in the US “need to get to at least 50%” of pre-COVID-19 traffic levels before they can break even; flying is now down 70% year-over-year and US airlines continue to bleed cash.

Calio noted that with airline employees furloughed, it will be difficult to ramp up once demand returns, another reason Congress should provide relief now, he said. “Our employees are different than other industry’s employees, because of the constant recycle of training that goes on,” Calio said, explaining that even if crews are grounded they could stay current with training if they remain employed.

De Juniac said the “risk of catching COVID-19 on board [an aircraft] is extremely low. We have to communicate to the public that the risk of contracting the virus on board an aircraft is minimal. We shouldn’t be ashamed. We have very good results [in terms of mitigation efforts] lowering the risk during air travel.”

He stressed that airlines around the world need to be on the same page when speaking to governments and the public. “We have to be firm and consistent with our message,” de Juniac said. “We propose [COVID-19] testing for all passengers before boarding … If we are firm and consistent with our message, we can move forward.”

Photo credit: Joe Pries