American Retired 40% Of Its Long Haul Planes During Covid — Many Are Now Headed To A New Airline

During the pandemic, American Airlines retired almost half of the long haul-capable planes in its fleet. They were conserving cash, avoiding maintenance costs, and making a bet that travel would not recover for a long time.

Other airlines retired planes, like Delta did with its small orphan fleet of Boeing 777-200s. But the smart move was Scott Kirby’s at United to take a wait-and-see approach. In April 2020 things looked dark but we just didn’t know what a year and two years into the future would look like. United kept its options open and didn’t retire fleets of planes.

American Airlines had 24 Airbus A330s.

  • 15 Airbus A330-200s, initially placed in temporary storage, then permanently retired in the third quarter of 2020.
  • 9 Airbus A330-300s, where the retirement decision was made in April 2020.

It wasn’t crazy to retire the 9 A330-300s. The 15 A330-200s were the big mistake. They were relatively young and would have been especially useful during the 2022–2024 Europe travel recovery. They also would have made a good Hawaii plane. I believe the A330-300s were leased (and American was still paying on them after they were parked) while the A330-200s were owned.

And even six years later, they still have a lot of life left in them. 8 are now reportedly headed to their next life in Vietnam.

In 2020, American recorded about $1.4 billion of non-cash write-downs and $102 million of cash charges tied to early retirements of the A330-200, A330-300, Boeing 757, 767, and Embraer E190 fleets.

Brian Znotins, who runs network planning for American, has said he prefers domestic flying over international. He also prefers “adding a second frequency to some destinations, using two of these smaller planes instead of one larger one.”

[T]hat sixth trip from DFW to Indy is what we’re going to be earning a profit on instead of going to some speculative destination in Europe or Asia where you don’t have as many people wanting to go there and we’re not as successful on those routes.

american airlines planes parked in pittsburgh
During the pandemic A330s and E190s Were Parked in Pittsburgh, Credit: American Airlines

american planes parked in pittsburgh
During the pandemic A330s and E190s Were Parked in Pittsburgh, Credit: American Airlines

American had 17 Boeing 767-300ERs at the start of 2020, when that fleet was retired. They were old, maintenance-heavy, and weren’t as nice in business class (though they were my favorite coach plane). They were still useful for cheap long haul flying, good for experimenting with new routes. Several of these planes found new life as freighters for Amazon.

They had 34 Boeing 757s at the start of 2020 and these were retired at the outset of the pandemic as well. I believe that AerSale acquired a couple dozen of them, and Northern Pacific eventually acquired nine. They were old and fuel inefficient, but useful for thin transatlantic routes. They were retired with no replacement on the immediate horizon (the Airbus A321XLR did not debut until late 2025).

Finally, American had 20 Embraer E190s and retired those as well. Alliance Airlines in Australia bought 16 of them for $65 million, and fly them for Qantas.

These retirements all came right after they had just finished retiring their MD-80 fleet in September 2019. At final retiremnet they still had 26 of these planes (at 2003 peak they were operating 362 of them). As of last year 18 of these were still flying.

This all had major downstream consequences for American.

  • American missed the 2022–2024 transatlantic boom because it lacked aircraft. They blamed Boeing, but that’s not really fair.

    International traffic recovered sharply in 2023 and 2024. International grew about 40% in 2023 and then another 13% in 2024 – growing past 2019 levels. By removing 24 A330s, 17 767s, and 34 757s, American retired 75 long haul-capable planes which was about 40% of their total.

    American blames Boeing delays for having so few widebodies but American itself deferred 787s. In 2021 it reached an agreement with Boeing to defer and convert five Boeing 787-8s to 787-9s. Then in late 2023, American deferred 10 of 30 remaining firm 787-9s, originally due in 2024 – 2025, to 2028 or later, saying that delivery schedule better aligned with anticipated demand and growth plans.

    At some level, it was arguable at the time to retire the 757s and 767s and even the A330-300s. It seems like an obvious error to have retired all of those and to rely on Boeing hitting timelines for replacements. It left them without cheap planes, optionality, or platforms for growth. But retiring perfectly good A330-200s was nuts.

    Keeping the A330-200s in a condition to restart them flying in a couple of years might have been a $100 – $200 million decision. That was the original plan.

  • It’s also a good part of why they found themselves in the hole in Chicago. American’s post-pandemic network strategy clearly emphasized high-return, high-scale hubs such as DFW and Charlotte. Without the 757s and E190s flying elsewhere, planes that might have returned to Chicago couldn’t. That meant less flying out of Chicago, and when the airport reallocated gates based on usage earlier than expected, American had gates taken away.

United made option-preserving decisions. In May 2020, United hadn’t retired an aircraft type and said it wanted more visibility into recovery before making permanent fleet decisions. By 2024, United was planning its largest-ever transatlantic schedule and had leased Airbus aircraft to mitigate Boeing delivery uncertainty. That contrast was marked.

American talked throughout the pandemic about its ‘Green Flag plan’ to come out of Covid-19 ready to race ahead of the competition. But the management and board at American chose to ditch aircraft that still had life in them, betting that the future market for their product and business would be much more limited than it had been in the past. That falls on CEO Doug Parker and the board, but the current CEO of the airline was President then, too.

Those fleet decisions in 2020 made sense if you believed travel demand would stay limited for a long time. It’s another example – along with leadership’s pre-pandemic view that success in the airline industry meant modeling Spirit Airlines in Frontier – of management simply having the wrong vision for the airline, misreading the direction of travel. That’s one of the key jobs of a CEO.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. “Those fleet decisions in 2020 made sense if you believed travel demand would stay limited for a long time.” *new forever-war, increased fuel costs, shortages*

  2. @1990

    You can’t be certain about it being a forever war. I don’t trust the administration to make the right decisions but I also don’t think they’re predictable.

  3. Still gets those CEO salaries and his golden parachute when he gets ousted, not bad for a guy who didn’t listen to his employees in the trenches. The bean counters are running AA, the old time type of grassroots airline guys aren’t around anymore. Where’s Bob when we need him???

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