COVID-19 pandemic forces American to retire its Boeing 757 and 767 jets

American Airlines is moving up the retirement date for its Boeing 757 and 767 aircraft fleets and suspending all hiring system-wide. Fort Worth-based airline, one of the largest employers in North Texas, said it will suspend all hiring system-wide and retire two fleets of aircraft earlier than it expected after a drastic reduction in travel demand due to the COVID-19 pandemic.

In a message to employees, Doug Parker, American’s CEO, said the airline “moved quickly to reduce our schedule to match demand, [but] it’s become clear that more is needed.”

“We will accelerate the retirement of our remaining Boeing 757 and 767 aircraft,” Parker wrote in the message to employees late last week. “Doing so removes older, less fuel-efficient aircraft from our fleet sooner than originally planned and avoids unnecessary maintenance and fuel costs.

“The 767 fleet will be grounded in May 2020, and the remaining 757 aircraft will retire between May 2020 and post-summer 2021 at the latest.”

There are 50 jets affected between the two fleets and those planes are, on average, 20 years old.

To stop the new coronavirus from spreading, President Trump ordered all flights between the United States and China to stop recently. On Friday, the president also suspended European travelers from entering the country for 30 days, though U.S. citizens and legal residents will be allowed to return to the U.S.

The emergency presidential orders and the national public health response have hit airlines hard.

United Airlines President Scott Kirby said that domestic bookings at his airline – which has a massive presence at Houston’s Bush Intercontinental Airport – are currently down 70% because of coronavirus concerns.

American announced it will also defer annual merit increases for leadership until August, suspend hiring system-wide for at least sixty days and offer extended unpaid, voluntary leaves of absence to employees.

“We are evaluating all of our staffing levels to make sure we’re appropriately staffed for our evolving schedule. We are working with union partners to offer voluntary leaves on an elective basis,” Parker wrote to employees.

American Airlines announced Sunday it would also reduce its international capacity by 75% compared with last year for flights from March 16 to May 6.

The airline also expects its domestic capacity in April to go down by 20% compared to last year, with May flights going down by 30% of last year’s capacity.

The airline will still have one flight a day from DFW International to London Heathrow (LHR) and three flights a week from DFW to Tokyo’s Narita (NRT).

But it is suspending all other flights to Asia starting March 16, including flights from DFW to Hong Kong.

It is also suspending service from DFW to São Paulo (GRU), Santiago (SCL), Bogota (BOG), Guayaquil (GYE), Quito (UIO) and Lima (LIM) starting March 16.

In an interview with WFAA this weekend, U.S. Sen. Ted Cruz suggested the travel industry could get a potential federal bailout after the COVID-19 pandemic is successfully stopped.

“It’s going to be a major economic challenge, and I fully expect Congress and the administration to work, and work creatively, to try to address that economic challenge because there’s no doubt we need to continue to have a vibrant and healthy commercial airline industry in the United States,” Cruz told WFAA.

“They’re losing actually billions of dollars,” he added. “This is an unprecedented challenge. They’re seeing a greater challenge to their balance sheets than they saw after September 11. They are working to extend their ability to stay afloat.”

The International Air Transport Association – the industry’s trade association – estimates that airlines could lose up to $113 billion dollars because of the pandemic. Significantly lower oil prices will help offset some of the losses, but airlines around the world are taking emergency measures to stay afloat, IATA said.

But if the Trump administration and public health officials are not able to quickly stop the virus from spreading, there is concern among airlines, Cruz said, that domestic travel restrictions could also be imposed on the American public.

“If the epidemic continues to spread, I don’t think it would be surprising to see domestic travel halted – probably at least initially in key affected regions,” the senator explained. “But potentially, more broadly. That’s been a big topic for discussion as I’ve visited with the CEOs of the major airlines.

“They’re very concerned. They’re already seeing domestic travel dropping precipitously just because people are concerned and declining to fly, but I think it’s possible we will see a pause in domestic travel depending on the health circumstances.”

Lori Bassani, the president of the Association of Professional Flight Attendants (APFA), issued a statement in response to the news about American Airlines. The union represents the company’s 28,000 flight attendants.

“These new International changes are hard-hitting. American is phasing out most international flying with a reduction of 75% year over year from March 16 to May. It will continue to operate: one flight daily from Dallas-Fort Worth (DFW) to London (LHR), one flight daily from Miami (MIA) to London (LHR), and three flights per week from Dallas-Fort Worth (DFW) to Tokyo (NRT).

“American Airlines confirmed last night that flights still continue to operate in short-haul international markets including Canada, Mexico, Caribbean, Central America, and some South America (northern part) as scheduled. Domestic capacity will be reduced by 20% in April and 30% in May on a year-over-year basis. Obviously, this means that Flight Attendants’ schedules are significantly reduced.

“Our union has worked hard in these past couples of weeks with American Airlines’ management to provide flexible options for Flight Attendants as we navigate through these tough times. To that end, we have offered voluntary short-term leave options and are working on longer-term voluntary leave options.

“On the health front, we have demanded all protective measures for our Flight Attendants be provided on every flight-focused first on international flights but now on flights everywhere. We have also addressed internal protocols and the sick policy for crew members who may be exposed and/or quarantined.

“In the coming days, APFA will continue to call on our lawmakers on Capitol Hill to assist our industry and Flight Attendants. We are also calling on our Flight Attendants to assist us to push lawmakers as needed.

“As changes and network reductions continue to roll in, we are working around the clock to stay on top of the news that obviously impacts every person in the airline industry. And while many of us have lived through life-changing events, it’s important to know that we have come back from every kind of crisis known to man in modern times.

“During 9/11, I worked as APFA’s media consultant. That event, as well as many other difficult times, has allowed me to see the true resilience and caring nature of our workforce. The hearts of our Flight Attendants will no doubt once again lift up our communities and see us through to the other side of this crisis.” www.wfaa.com