American Airlines (NASDAQ:AAL) is slashing international and domestic flights as demand falls amid the coronavirus epidemic, the carrier said Tuesday.
The move follows similar measures announced last week by JetBlue (NASDAQ:JBLU) and United (NASDAQ;UAL). U.S. carriers had previously reduced flying to China, where the virus was first detected, and elsewhere in Asia, but its rapid spread has hurt demand for flying more broadly, prompting deeper and more generalized cuts.
American also said it will shave 10% off its peak summer international flying, one of the clearest signs yet that airline executives expect the coronavirus’ impact on the business to last longer than expected. That includes a 55% cut to its trans-Pacific flying capacity as travel demand throughout Asia plummets.
The virus originated in Wuhan, China in December and quickly spread throughout that country and to nearby South Korea, Singapore and Japan.
The carrier will also cut April domestic capacity by 7.5%.
"These capacity reductions," referring to Tuesday’s news release, "assume no slot waivers are in place. At airports where demand exceeds airfield and/or terminal capacity, access is governed by slots that grant airlines permission to take off and land at specific times.
"Given the drop in demand related to COVID-19, American has requested temporary relief from this usage requirement – otherwise known as requesting a slot waiver – to better align capacity with demand without the risk of losing valuable takeoff and landing slots for the future. American will continue to review its network and make adjustments as needed if waivers are granted."
AAL shares hiked 83 cents, or 5.6%, to $15.58
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