US Airlines Face Critical Two Weeks Ahead | Will There Be a CARES Act Round 2?
KEY POINTS:
- “New CAPA modeling projects domestic US seat capacity to be down by 60% year-on-year by the middle of August - the summer peak - and down by almost half of last year’s level of capacity by Thanksgiving in November - but even this level of production could be hampered by the rampant spread of the virus in the US.”
- “Now, as cases again surge in what Anthony Fauci, the US government's top infectious diseases expert on 2-Jul-2020 called "a very disturbing week", US airlines could once again be forced to cut their capacity levels, if underlying demand evaporates as a consequence.”
- “In this vein, IATA's Chief Economist, Brian Pearce reported on 2-Jul-2020 that “There was a dip in bookings in the second half of June, as coronavirus cases picked up... This is causing us to be rather cautious about prospects in the next few months.”
- “CAPA Chairman Emeritus, Peter Harbison, said: “The outlook for US airline capacity beyond the summer peak is highly uncertain. If COVID-19 cases continue to surge as they have over the past week (to 3-Jul-2020), the beginnings of the recovery could fade away. The introduction of more quarantine measures could also dampen key north-south leisure markets. For example, travelers returning home to the states of New York, New Jersey, Connecticut from their Florida holidays must undergo 14 days' quarantine.”
- “Business travel in the US is expected to remain suppressed for the foreseeable future as corporations maintain their travel bans into 2021. Some businesses are achieving productivity and efficiency benefits from streaming services, which could impact how corporations manage their travel in the near future. During this period, travel may only be necessary to “close the deal”, rather than engage in face-to-face negotiations.”
- "Aside from repatriation/VFR and cargo services, there are not many drivers for the US international air market right now.”
- "International travel to/from the US will simply not recover until the spread of the virus abates and global coordination improves in terms of what passengers can expect in terms of measures to safeguard their health on the travel journey.”
- "As a consequence, US airline revenues will remain depressed for the foreseeable future. That dire scenario is forcing US airlines to amass huge levels of debt to cover continuing high cash burn.”
Click here to read the full article.
Airline Bookings Tumbling Again | Will Retirements Be Enough to Offset?
KEY POINTS:
- “Airlines for America reports that 39% of the planes in the US airlines fleets remain grounded and they are operating only 46% of their normal flights.”
- “With the surge in Covid-19 cases and signs of a drop in bookings, airlines that added flights may have gotten ahead of themselves. They could soon be flying mostly empty planes and running up losses once again.”
- “United Airlines (UAL) presented sobering facts to employees Monday that bookings are tumbling as Covid cases soar. Also hurting travel demand: regulations in New York, New Jersey and Connecticut that mandate travelers from the pandemic's US hotspots quarantine themselves for 14 days.”
- “Near-term bookings at United's hub in Newark were only 16% of 2019 bookings as of July 1. That's about half the level of demand of just two weeks earlier, when United's bookings were at 35% of the year earlier levels.”
- “Delta Air Lines (DAL) confirmed to CNN that its booking trends in the New York area are similar to United's, although it did not release statistics.”
- "It certainly could be a jagged recovery," he said. "The initial surge in bookings, there was probably some pent-up demand in there. There's no doubt that the increase in [Covid-19] cases and quarantines throws a monkey wrench into it."
- "There's so much uncertainty about the virus and that's feeding people's fears and perceptions about the safety of travel," he said. "A second wave was always a downside risk for the overall economy and the airlines in particular."
Click here to read the full article.
Weekly TSA Numbers | What’s The Trend Showing?
“The airlines made the calculations for WARN Act notices while the recovery was happening. This week saw future bookings drop, spiking COVID cases continue to be reported, quarantines, and travel restrictions enacted - these were not part of that calculation, at least not to this level. Cities and States, theme parks and tourist destinations were supposed to continue to open, we’ve seen numerous reversals. Now we are seeing announcements from the major airlines stating they plan to scale back plans for August and beyond, even low-cost carriers! Sure they don’t have to furlough everyone that received a WARN notice, but can we agree when they sent these notices out they believed they would be in better shape by October than they now feel?”
-Raven Advisor
COVID-19 Resurgence Threatens Travel Rebound | “It’s March All Over Again”
KEY POINTS:
- “Airlines are preparing to cut thousands of workers and tap government loans as a surge of coronavirus cases and fresh government travel restrictions upend a nascent recovery in travel.”
- “The bookings metric, which is the difference between new reservations and cancellations, has also started to fall in other hubs, the airlinen [United] told employees.”
- “Most airlines, including United, have cautioned workers that they would have to reduce staff on Oct. 1, when the restrictions that accompanied $25 billion in federal aid are lifted. United has already said it plans to cull its management and administrative workforce by 30%. Delta Air Lines Inc. DAL 5.61% last week sent similar notices to more than 2,500 of its pilots.”
- “States and cities are clamping down on travel from new coronavirus hot spots. Chicago is also requiring visitors from 15 states to quarantine for two weeks upon arrival, as is Pennsylvania”
- “Businesses and attractions that had been planning on reopening are having to shut down again in hard-hit areas. Miami-Dade County Mayor Carlos Gimenez on Monday rolled back reopening there, ordering gyms to close and restaurants to limit service to takeout and delivery, starting Wednesday. Walt Disney Co. ’s Disneyland resort, which was slated to reopen July 17, will remain closed until an unspecified date, the company said last month. Texas also paused its reopening.”
- “United also told employees that it plans to make some adjustments to its August schedule in response to reduced demand to destinations that have an increase in Covid-19 cases or new quarantine requirements. The airline now expects to operate about 35% of its year ago schedule in August, an increase from July but pared back slightly from the plans it announced last week.”
- “Members of management noted that the Company does not expect the recovery from COVID-19 to follow a linear path, as illustrated by recent booking and demand trends, and that consolidated capacity through the end of 2020 is expected to be generally consistent with August 2020,” the company said in a filing Tuesday afternoon.”
- “All of this has made travel both more complex and less appealing. Some see similarities to the beginnings of the pandemic’s spread, when demand dried up rapidly over the course of just a few weeks and airlines had to swiftly cut schedules to keep up.”
Click here to read the full article.
Delta CEO: Latest COVID-19 Spike Crushing Travel Demand
KEY POINTS:
- “After a brief uptick in flying interest this spring, the jump in US coronavirus cases has crushed travel demand during the normally busy summer season, the head of Delta Air Lines said Thursday, warning of job cuts ahead.”
- “Delta Chief Executive Ed Bastian said surging coronavirus cases in the US Sun Belt necessitates "renewed caution" about returning planes to service that were grounded to save money and he urged workers to consider the airline's voluntary exit program to "minimize involuntary furloughs."
- “The carrier is operating at only about 30 percent of its normal July schedule, Bastian said in a memo to employees, and the situation is "clearly not sustainable over the long-term."
- “The memo comes a day after United Airlines warned it could lay off as many as 36,000 workers on October 1, depending on how many workers accept voluntary exit packages.”
“Delta executives have been signaling plans to shrink for months, saying in a memo to staff in May that it estimated that it would be overstaffed by 7,000 pilots this fall.”
Click here to read the full article.
Why Applying Online Doesn’t Work | Do This Instead
Get on LinkedIn immediately...
You have a 3% chance of getting a job if you apply online.
Why?
Because recruiters are receiving around 300 new pilot resumes per week with an average flight time of 8400 hours.
75% of resumes will be denied by a RESUME SCANNER before a human ever looks at it.
Of the 25% that recruiters actually see, they will only spend 6 to 8 seconds reviewing each.
Get This...
64% of new pilots hired were as a result of an internal referral
Only 7% of pilots are ever successful at getting someone on the inside to walk their stuff in.
Why?
Because they don't know someone on the inside and networking is challenging.
Get on LinkedIn and do the following:
- Follow companies you want to work for.
- Search people at those company's and connect to them.
- Every connection request needs to come with a personalized note or your connection rate will suck.
- Get your connection to talk about them, their company, what they like and dislike about working there.
- Identify problems their company is having that you can solve: safety, training, mentoring, etc.
- Show them that you clearly understand their problems and can solve them.
- Position yourself as either the best or only solution for their problems. If you can be both the best and only solution...even better!
- Show them you are a good cultural fit.
Costco gives out free samples because showing is always better than telling. Don't tell people how smart, great, whatever you are...SHOW THEM through your comments and posts.
Do this and you'll get a job.
Companies will be asking for your resume instead of you blindly emailing them.
Don't forget, you need to come across as:
GOOOOOOD LUCK!!
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“Looks like Graham does good work. My LinkedIn profile was updated yesterday and I got a comment on my resume today. I've never had anyone make a comment on my resume before.” M.M. Furloughed Pilot
WATCH this SHORT video with 2 aviation HR professionals
Additional Resources
Why Applying for Jobs Online Won't Work
How Does the Coronavirus Compare to 9/11?
How to Survive Disruptive Change
Are Furloughs Coming?
What Should Pilots Do In These Uncertain Times?