Former Spirit Airlines CEO Ben Baldanza predicts there will be a decline in business travel and airlines will have to rely more on leisure travel for revenue.
American Airlines workers are expected to prepare for another round of break notices, as the company expects to remain over-staffed on April 1, when U.S. aid to industry workers expires, Chief Executive Doug Parker said.
American is among the US airlines that received money from a $ 15 billion payroll support package in December to protect workers’ jobs and wages until March, when the industry expected demand hit by the pandemic to have recovered with the launch of vaccines.
AMERICAN AIRLINES QUARTERLY LOSS BETTER THAN EXPECTED
“What didn’t happen is what we expected to happen, that we would arrive on April 1st and say, oh my God … everyone we have, we will need them on the July schedule,” said Parker during a municipal meeting with officials on 28 January, according to a recording reviewed by Reuters.
An American spokesman confirmed the accuracy of the recording.
U.S. aviation unions are asking Congress to extend a third round of payroll assistance, something Parker said he would support.
“This is a much better solution than having people dismissed again when we know that this (COVID-19) is months away from being eradicated,” he said during the mayor’s office.
The Americans released 19,000 workers when the first round of government payroll support expired on October 1, but withdrew them in December. Parker said he expected fewer workers to be affected this time.
DISCOVER FOX BUSINESS ON THE MOVE BY CLICKING HERE
Last week, United Airlines said it had sent license notices to 14,000 employees.
US airlines, which recorded record annual losses, expect vaccines to fuel a recovery, but distribution has been slow and the COVID-19 variants are causing drastic travel restrictions in some countries.
“I hate being in that position, but we are and we can’t ignore that, so we have to start figuring out what to do about it,” he said.
CLICK HERE TO READ MORE ABOUT FOX BUSINESS
Parker said the new test requirements for COVID-19 for people entering the U.S. from abroad have further suppressed the demand for international travel.
| Ticker | Safety | Last | change | Change % |
|---|---|---|---|---|
| AAL | AMERICAN AIRLINES GROUP INC. | 16.84 | -0.33 | -1.92% |
| DAL | DELTA AIR LINES INC. | 37.82 | -0.14 | -0.37% |
| LUV | SOUTHWEST AIRLINES CO. | 44.79 | +0.85 | + 1.93% |
Delta Air Lines and Southwest Airlines avoided layoffs, but reduced their workforce through voluntary programs.