American Airlines will accelerate the retirement of its Boeing 757 and 767 fleets (and won’t have reason to extend service of their Embraer E-190s). They’re cutting flights, including much of Europe and even some service to London. And they’re promising that actual quarantined employees won’t be fired for taking sick time.
Norwegian Air says they may run out of cash in a matter of weeks. Their long haul business is between several European countries and the U.S., but Europeans largely cannot travel to the U.S. for the next month. Bookings are down anyway in the current environment, and this was a troubled airline to begin with.
What a difference a few weeks make. Qatar Airways CEO Akbar al-Baker gave an interview where he was skeptical about the seriousness of the novel coronavirus, and annoyed at the inconvenience to aviation. “You don’t block aviation just because there is something in the air but it’s really not a scientific fact” he said.
He probably now wishes there wasn’t video.
At the beginning of the week airlines knew the novel coronavirus impact on their business could be large, but no one was taking this as seriously as United. That’s changed. Delta has sent a memo to employees outlining unprecedented changes to their business in light of drying up revenue.
Delta’s CEO Ed Bastian says that they’re receiving more cancellations than new bookings, and that “the demand fall-off is unlike anything we’ve seen” as a result they are “moving quickly to preserve cash and protect” the airline.
Hyatt was first out of the gate with an offer of points for customers having to cancel non-refundable bookings. I thought that was generous because they were first and it was something. Of course this is all fast-moving, and other hotel chains have since done more.
So Hyatt has responded, well I think, and is out with a new policy allowing for cancellation of non-refundable bookings, encouraging new bookings, and offering greater flexibility for Hyatt points.
Marriott is out with a policy giving flexibility to existing reservations, offering additional flexibility on new bookings, and extending expiring points, suite upgrades, and free night certificates.
Effective today United Airlines plans to stop offering some seats that used to be available for upgrade to members of their MileagePlus program, holding those back to sell to infrequent customers at check-in instead. This helps the airline generate extra short term cash now as they prepare for a drop in revenue of as much as 70%.
American is extending their AA20 program – 20% off paid travel for employees – to web special awards. If there was any doubt that these web specials were revenue-based redemption, this change should offer insight into how American thinks about them.
Domestic hotels already began experiencing a decline in rates and occupancy last week. Next week will be worse. Here are the details.
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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 »
