In exchange for $79 billion in direct subsidies from the federal government, airlines agreed not to drop any of the routes they flew before the pandemic without permission from the Department of Transportation.
As this requirement from the first of three rounds of subsidy packages was about to lift last fall, American Airlines threatened to pull service from 15 cities right away unless they were given an additional $5 billion.
- These cities appeared strategically chosen based on the districts of influential members of Congress
- Pulling service from two of the cities wasn’t even legal but someone at American forgot to check that (they were eventually able to leave several months later)
- They even directly traded the continuation of small city air service for political support for subsidies
The government kept shoveling more money at the airlines, and American and other carriers kept flying to small cities. This wasn’t actually necessary, because the Department of Transportation had the authority already to tell the airlines to keep flying their existing routes as part of their accepting subsidized loans. The government didn’t exercise that authority, and taxpayers were fleeced twice for the same flights.
The final obligation of the third round of subsidies lifted on September 30, 2021. And American Airlines has ended service to three cities as a result:
- New Haven, Connecticut (HVN)
- New York – Stewart (SWF)
- Williamsport, Pennsylvania (IPT)
All 3 cities were on the original threat list to see an end to service a year ago.
Outside of these three, and the two Essential Air Service cities that were reassigned (Joplin and Sioux City), American continues to fly to the other 10 cities on its threat list even though it’s no longer required to do so.