US airlines are slashing flights and cutting executive pay as the coronavirus outbreak tanks demand for air travel.
American Airlines and Delta Air Lines on Tuesday said they will reduce domestic and international capacity in response to the lower demand, while top executives at Southwest and United will give up some or all of their salaries.
Texas-based American said it will cut domestic capacity by 7.5 percent in April and reduce international capacity by 10 percent during the “summer peak,” including a 55 percent cut to trans-Pacific flights.
Delta is trimming domestic capacity by 10 to 15 percent and cutting international capacity by 20 to 25 percent, the Atlanta-based carrier said. United and JetBlue have also announced reductions amid the coronavirus epidemic that has led to international travel restrictions and canceled several major events.
“As the virus has spread, we have seen a decline in demand across all entities, and we are taking decisive action to also protect Delta’s financial position,” Delta CEO Ed Bastian said in a statement.
United CEO Oscar Munoz and president Scott Kirby will forego their base salaries through at least June 30, the Chicago-based company said in a regulatory filing, adding that it expects to incur a loss for the first quarter of this year. Munoz’s salary in 2018 was $1.25 million while Kirby’s was $875,000, filings show.
Southwest Airlines CEO Gary Kelly told employees Monday that he would reduce his salary by 10 percent as the company grapples with the coronavirus, the company said. Kelly’s salary was $750,000 in 2018, records show.
American shares were up 8.2 percent at $15.96 as of 2 p.m. while United’s had jumped 6.4 percent to $49.80. Southwest stock recently ticked up 0.1 percent to $43.67 while Delta shares were down 0.5 percent at $43.27.
British Airways also canceled all Tuesday flights to and from Italy in light of nationwide quarantine measures in the country and the UK government’s advice against non-essential travel to here.
“We have updated our policy to give customers more options and flexibility,” British Airways said in a statement. “Any travelers due to fly to or from Italy between now and April 4 can rebook to a later date up until the end of May, move their destination to Geneva or Zurich or receive a full refund.”
American said it is further reducing service to parts of Italy, where the government to the entire country on Monday to combat the spread of the coronavirus.
The airline said it is suspending flights to Rome from Philadelphia through the end of April and from Chicago and Charlotte through early summer. Its suspension of service to Milan has also been extended, the company said.
American flights from Los Angeles and Dallas to mainland China — where the coronavirus epidemic originated — will remain suspended through the summer, the carrier said.
