United Airlines Holdings booked $1.5 billion less revenue this month than the same period in 2019 and warned workers that planes will fly almost empty into the summer, even after dramatic reductions in flight capacity.
United Airlines said it would slash flying by 50 percent in April and May on Sunday night, and requested their employers to help cut expenses as the airline seeks support from the government to bail them out of the coronavirus crisis.
"We expect load factors to dip into the 20-30 percent range even with those cuts - and that's if things don't get worse," said United Airlines Chief Executive Oscar Munoz and Scott Kirby, President, in a letter to employees.
United is cutting wages for corporate officers by 50 percent, with significant capacity reductions also expected for the summer travel season.
The extraordinarily drastic decline in future bookings combined with unprecedented cancelations have far surpassed anything that United or the rest of the industry has experienced before, including or since the 9/11 attacks, said Todd Insler, chairman of the United Chapter Master Executive Committee of the Air Line Pilots Association.
Since late January, steps have been taken to actively address this crisis by drastically reducing schedules, imposing a hiring freeze, implementing a voluntary leave scheme, significantly reducing discretionary spending, slashing CEO base pay by 100 percent and postpone a wage increase, United Airlines said in a statement.
United's stock was down 47.7 percent over the past month through Friday, while Dow Jones Transportation Average fell 26.9 percent and Dow Jones Manufacturing Average dropped 21.1 percent, respectively.
Airlines around the world are struggling to conserve cash as demand for a flight, craters have turned to more stringent steps that have disrupted everyday life in an attempt to keep COVID-19 from spreading.
The sudden airline cuts will reverberate all over the economy. By the end of January, US airlines alone had hired some 747,000 people, according to federal reports, but as carriers parked aircraft and postponed orders, manufacturers as big as Boeing and Airbus and their suppliers were now on shakier footing.
The company disclosed it was working round the clock to keep as much pay as possible flowing to workers, even though the crisis worsens and "demand momentarily drops to zero."
United, American Airlines Group and Delta Air Lines - the three main U.S. carriers - announced Friday that they are in discussions with the U.S. government about potential assistance in the midst of a dramatic decrease in demand for air travel.
