American Airlines suspends flights to 15 small cities after government aid ends

A member of a ground crew walks past American Airlines planes that are taking off at Washington’s Ronald Reagan National Airport during the outbreak of the coronavirus disease (COVID-19), March 5, 2020.

Joshua Roberts | Reuters

American Airlines said Thursday it plans to suspend service to 15 small, low-demand U.S. cities in October after federal aid terms that require the flights expire, a move that would halt scheduled flights to nine destinations in as many states.

American and the other U.S. passenger airlines that accepted $25 billion in federal payroll shares had to maintain a minimum level of service through Sept. 30.

American is currently the only airline to offer scheduled flights to nine of the airports where flights are scheduled to be grounded. They are: Del Rio, Texas; Dubuque, Iowa; Florence, South Carolina; Greenville, NC; Joplin, Missouri; New Haven, Connecticut; Roswell, New Mexico; Stillwater, Oklahoma and Williamsport, Pennsylvania.

American also plans to suspend flights to these airports: Sioux City, Iowa; Kalamazoo/Battle Creek, Michigan; Huntington, West Virginia; New Windsor, New York; Springfield, Illinois; Lake Charles, Louisiana.

American said it had notified affected airports ahead of its Thursday announcement.

“We really had no idea or warning that this was ever being considered,” said Joplin Regional Airport Manager Steve Stockam.

“It’s obviously a big impact for our community because American is the only airline here,” Stockam said.

Stockam said he’s confident flights would be restored ahead of the Thanksgiving and Christmas holidays so locals can “get where they need to go.”

airline unions and airline executives including American have asked the legislature provide an additional $25 billion in airline payroll subsidies and loans. While the initiative won bipartisan support In Congress, lawmakers failed to reach agreement on another national coronavirus relief package that could include the airline’s additional aid.

This aid package should help keep airline workers’ jobs alive and ban layoffs by October 1. However, demand has only recovered to less than a third of normal summer volumes, and airlines have warned more than 75,000 employees that their jobs will be at risk when the subsidy deadlines expire.

American had prepared to shut down the service in as many as 30 cities, CNBC first reported last week. The cuts will take effect from October 7th to November 3rd. The airports were chosen because they have attracted little demand and are unlikely to recover anytime soon, according to a person familiar with the matter.

Demand for air travel has slumped due to the pandemic, as concerns about the virus and travel restrictions are keeping many potential customers away. Passenger numbers have been rising for more than five decades, hitting April, but remain weak for the peak summer season.

Federal data shows the Transportation Security Administration screened an average of 708,684 people per day this month, down 71% from a year ago.

Delta Airlines and United Airlines didn’t say if they plan to make similar cuts after the aid expires. Southwest Airlines said it is not currently preparing to suspend service because of the expiration, but the airline is cutting its September capacity to 40% of last year’s level and in October it will drop to 50% of the same month in 2019.

US shares fell 1.4% to $12.50 on Thursday. Delta fell 0.2% to $27.62, while United fell 1.1% to $34.05. Southwest gained 0.6% to close at $34.46.

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