American Airlines said it saw increased demand in May and is adjusting its July schedule accordingly
Shares of American Airlines (AAL) are on the rise on Wednesday after the company said it is planning to fly 55% of its domestic schedule in July, up from May when it flew 20% of what it did the same month in 2019. Meanwhile, United Airlines (UAL) previously said it had seen a reduction in customer cancellation rates but expects July scheduled capacity to be down approximately 75% relative to 2019 levels.
IMPROVING DEMAND: American Airlines announced that, "in response to improving demand for air travel," it is planning to fly 55% of its domestic schedule and nearly 20% of its international schedule in July 2020 compared to the same period last year. The airline's July systemwide capacity amounts to approximately 40% of July 2019 flying.
"American saw an increase in demand in May. By the last week of May, the airline carried a daily average of about 110,000 customers per day - an increase of 71% over the approximately 32,000 average daily customers the airline served in April. Compared to the spring, American is increasing frequency of flying from hubs, including Dallas Fort Worth International Airport and Charlotte Douglas International Airport to destinations customers are searching and booking most, with increased flying to major cities in Florida, Gulf Coast cities as well as mountain destinations. The airline also increased frequency of flying to Asheville, North Carolina, Savannah, Georgia, and Charleston, South Carolina for business and leisure travelers," the company added.
American also said that, "While international demand continued to be diminished, today marked the return of service to eight international destinations. These include service from Dallas-Fort Worth to Amsterdam, Paris and Frankfurt, as well as service from Miami to Antigua in the Caribbean and Guayaquil and Quito in South America.” The company also restored additional service to London from Chicago and New York. American will delay the return of some previously announced international routes--including transatlantic service from Philadelphia and Charlotte Douglas International--to August.
"As demand for travel increases, American is deploying new tools to notify and allow customers booked on fuller flights to rebook on more open flights when available, all without incurring additional cost. On fuller eligible flights, a percentage of customers will be offered the option to rebook to a different flight during the check-in process. Also, American Airlines is providing customers additional flexibility by expanding waived change fees for customers booking tickets for any new travel purchased by June 30, 2020. […] Customers are allowed to change their origin and destination cities as part of this offer. […] American currently has a change fee waiver in place for all tickets, including Basic Economy, for travel through September 30, 2020," the company said.
REDUCED CUSTOMER CANCELLATIONS: In a regulatory filing last month, United Airlines said that, "In April, the company experienced gross bookings that were down over 95% compared to April 2019, with customer cancellation rates reaching unprecedented highs. As of May 18, 2020, the company has seen a reduction in customer cancellation rates and a moderate improvement in demand in the Domestic United States and certain international destinations for the remainder of the second quarter of 2020. As such, the company expects its scheduled capacity, relative to 2019 levels, for July 2020 to be down approximately 75%. Scheduled capacity for May and June 2020 were reduced by approximately 90% from 2019 levels. The company plans to continue to proactively evaluate and cancel flights on a rolling 60-day basis until it sees signs of a recovery in demand."
CABIN SEATING CAPPED THROUGH SEPTEMBER: Delta (DAL) announced in a blog post that it is extending its "commitment to make more space for safer travel" by continuing to block the selection of middle seats and capping seating in every cabin through September 30, 2020. "Reducing the overall number of customers on every aircraft across the fleet is one of the most important steps we can take to ensure a safe experience for our customers and people. Delta is offering the highest standards in safety and cleanliness so we're ready for customers when they're ready to fly again," said Chief Customer Experience Officer Bill Lentsch.
PRICE ACTION: In afternoon trading, shares of American Airlines have jumped almost 25% with $14.78, while United’s stock has gained about 15% to $38.56. Also higher are Delta Air Lines, Southwest Airlines (LUV), and JetBlue (JBLU).