United Plans Further Cuts to May Capacity

In a letter to employees, United Airlines CEO Oscar Munoz and President Scott Kirby said the carrier is cutting about 90 percent of its May capacity in response to the continuing effects of the coronavirus.

“Travel demand is essentially zero and shows no sign of improving in the near-term,” the executives said in the letter according to Travel Weekly. “To help you understand how few people are flying in this environment, less than 200,000 people flew with us during the first two weeks of April this year, compared to more than 6 million during the same time in 2019, a 97% drop. And we expect to fly fewer people during the entire month of May than we did on a single day in May 2019.”

Those stark facts could be a prelude to further cuts in June and potential layoffs come the fall. United is bound by the stipulations in the $2.2 trillion CARES Act, the stimulus package that included $50 billion for the airline industry with two key provisions – no layoffs or pay cuts to employees before Sept. 30, and airlines must maintain a minimum service to destinations already in place.

Munoz and Kirby said United will “maintain connectivity among nearly all our domestic destinations,” but the airline will continue to offer voluntary leave options and voluntary separation programs, according to Travel Weekly. Some 20,000 employees already have exercised that option.

After Sept. 30, however, United said it will have to make “tough decisions.”

“Not all states and cities are expected to re-open at the same time. Some international travel restrictions will remain in place. Meeting planners and tour operators will do their best to accommodate people looking to avoid large crowds,” they wrote. “So, while we have not yet finalized changes to our schedule for July and August, we expect demand to remain suppressed for the remainder of 2020 and likely into next year.”

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