During this morning’s earnings call, United Airlines President Scott Kirby told investors and journalists that the carrier is “planning for zero net passenger revenue for rest of year and into 2021.”
They hope demand recovers but they have plenty of places to go for cash and are driving down expenses. Come the fall the only place left to go for cuts will be reducing employee headcount. They even talked about taking loans out against the MileagePlus program.
The Freddie Awards are the voice of the frequent traveler. Each year millions cast their ballots for the best in loyalty. In normal times the industry comes together at the awards ceremony the last Thursday in April to see the winners (and each other).
Like Delta, American Airlines is capping ticket sales to make sure there’s enough room on their flights for social distancing. This will run through the end of May. And they’ve done an about face on prior policy and will even compensate volunteers to travel later in order to avoid filling up planes.
When American Airlines announced the suspension of most meal service in late March, it made sense. This substantially reduced interactions between customers and flight attendants.
At the time the airline said this suspension would last through April 30. I assumed it would be suspended indefinitely. However it turns out that American is bringing back some catering on flights less than 2200 miles effective May 1. This is available to all passengers in all cabins.
Delta is going to cap the number of seats they sell in each cabin of their aircraft through June 30, to promote social distancing. Delta will also require customers to wear face masks starting May 4.
To show how quickly things are changing – the modern day equivalent of one being as a thousand years and a thousand years one day – it was only Monday that American announced flight attendants would be required to wear masks and that starting May 1 they’d begin to roll out complimentary masks for customers as an option, subject to supply chain and operational constraints.
Indeed it was just six weeks ago that American still disciplined flight attendants who wore masks.
Trivago, which is majority-owned by Expedia, along with 7 other companies wants Google to stop trying to collect on first quarter ad spending. These companies bought advertising, sold travel, but in many cases the trips didn’t happen – so they aren’t seeing revenue from those sales.
These companies are looking to the German government for bailouts, and want a bailout from Google as well because these companies would otherwise “be forced to use government loans to pay their debts.” German taxpayers would, in effect, be sending money to Google.
A roundup of the most important stories of the day. I keep you up to date on the most interesting writings I find on other sites – the latest news and tips.
We’re in a recession. We’re not traveling. Rewards credit cards that are optimized for travel may not be top of wallet. Cards that are optimized for heavily travel customers may also not match current spending patterns. We’re beginning to see brands and issuers adapt.
American Airlines lost over $2.2 billion in the first quarter, even though things didn’t begin to go south until March. They’re pulling in new cash everywhere they can, cutting costs, and expect not to have any difficulty securing not just payroll protection grants from the U.S. treasury but also subsidized loans.
Those financial metrics aren’t what I’m most interested in at this point, nor the $40 billion in debt they could soon be carrying. Those issues are well covered elsewhere. I wanted to highlight 6 other things last may get less play in broader coverage.
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 »
