In London just in advance of travel restrictions going into effect, American Airlines President Robert Isom traveled across the Pond to speak to employees there. American employees nearly 1000 people in the U.K.
He spoke at the British Airways headquarters at Waterside, and said that while they aren’t going to spend “even a dollar” that they do not have to, they owe it to customers not to degrade the inflight experience and that the company is “prepared to weather any type of storms that come up.”
He says there’s “enough cash on hand to weather downturns in the business.” The novel coronavirus is “unprecedented, the demand impact, but even this American has done well” – noting the airline’s liquidity over $7 billion, and working to improve it even more – but that the airline has to do “all we can to make sure we conserve that.” (They’ve just picked up another $1 billion shoring up their position and demonstrating that capital markets remain open to them without government intervention.)
Isom reports that American “has prepared ourselves to be ready for this time.” They’re doing this by trying to “size the company” for the demand that’s out there now. That’s why they’re “looking at voluntary leaves.”
He knows that American has “to be prepared no matter how long this is so that we can weather this storm” and that “it is more than likely that demand is slower to return to some of our international locations. So you’ll see that we have pushed flying to many points within Europe out a little bit further than just the next two months.”
Despite being ready, making adjustments to their business, and having plenty of cash he does think that American deserves a bailout – and when money comes they’re positioning themselves to be in line for some. In response to an employee question Isom offers his defense of looking to the government for money,
This is an industry problem. The depths of demand, a lot of that is driven by we’ve more or less shut off the ability of people to move freely… there does seem to be some precedent for taking a look at industry concerns.
Within the U.S. we’ve been in touch with really all the large agencies to make sure we are represented well, the industry as well is given some priority. Travel and tourism is really at the front of the line here in terms of being hurt.
Assume that we are talking to the appropriate parties in Washington. Assume that in the UK and the rest of the world most airlines are having that same discussion. It’s an industry issue, but air travel is vital to commerce in the long run.
I have great confidence that demand will return because that’s how business is done and that’s how so much leisure time activity is spent and consumed as well. We all enjoy it. It will come back but we have to have an aviation system that’s there when it’s ready to rebound.
…You can be assured that the American leadership team, Doug, me, others are involved in making sure that if there is something that comes about that American is taken care of as well.
Isom concludes, though, reminding employees “the good news,” that “American has done really a good job making sure we’re prepared to handle whatever crisis comes about.” Still, because of the “level and depths” of the effects of the novel coronavirus they’re making sure to “have a view to all potential resources that might be available and that we represent ourselves as such to our leaders in Washington.”