COVID-19 Virtual Meeting

Recent Updates From the Experts at Ailevon Pacific

Updated March 16, 2020

The news continues to change by the minute, and we are tracking closely.  Worldwide airline capacity (ASMs) has dropped 13% yoy for March and 7% for April with more cuts be announced almost daily.

The Week Over Week Capacity Change Report has been updated but please note that it may not reflect all the announced schedule changes as airlines continue to evaluate and adjust their schedules.

Download Week-Over-Week Capacity Change Reports

Updated March 14

North America

Latin America

Oceania

What do these reports show?

These reports are designed to show the week-over-week capacity changes that airlines have made at your airport.  They show all changes in capacity loaded into the schedule as it is impossible to isolate only changes that are directly in response to the COVID-19 virus.

There are 4 separate tabs available to browse:

• Dynamic Table: Shows current outbound capacity for the current week’s schedule load and also a comparison to the previous week’s schedule load.  The table shows each week through the end of May.  SLICERS on the side can be used to filter the data.
• By Mkt & Airline – Changes: This tab shows any markets and airlines that changed capacity in the past week.  It is sorted from the largest reductions to the largest gain in capacity.  SLICERS on the side can be used to filter the data.
• By Market & Airline: This tab shows all markets and airlines alphabetically.  SLICERS on the side can be used to filter the data.
• Trend Charts: This tab shows your airport’s capacity after each schedule load.  It will continue to grow as we capture more weekly schedule loads and is designed to show the impact of the capacity changes over time.

How do I use these reports?

You must download these reports in order to use them.  They cannot be used within DropBox.

1. Download a report using these links: North America, Latin America, Oceania
2. Open the file in Excel
3. Choose to Enable Content at the top of the screen.  This will allow the macro to refresh the data for your airport
4. Enter your Airport Code in the top left of the Dynamic Table tab.  The data will refresh to be specific to your airport

The Instructions tab will provide further instructions on using SLICERS so that you can drill into specific markets, airlines, months or days of week.

What has the government required of airlines in response to COVID-19?

Governments around the world have put travel restrictions in place due to COVID-19.  Focusing specifically on the United States & Canada we know the following[1]:

• Central America/South America – Many countries are restricting entry from Europe, China, Iran and South Korea, cancelling public schools and colleges for 2 weeks and not allowing crowds at major sporting events
• China
  • U.S. citizens returning from Hubei province in the prior 14 days from their arrival into the USA will be subject to up to 14 days of quarantine
  • U.S. citizens returning from anywhere else in mainland China in the prior 14 days from their arrival into the USA will undergo proactive health screening at select USA airports with up to 14 days of monitored self-quarantine
  • Suspension of entry of any non-U.S. citizen who has been in China (excluding Hong Kong and Macau) in the previous 14 days
  • Canadian citizens are being asked to self-monitor and quarantine themselves in their residences for 14 days after travel to a known affected area

• Cyprus – will not allow non-Cypriots to enter until 30Mar
• Czech Republic – will close its borders and airports from 16Mar on
• Denmark – has closed its borders and won’t reopen until 13Apr
• Ecuador – has closed its borders and airports for 21 days until 5Apr
• India – Suspension of tourist visas through 15Apr; banning European carriers from 18Mar-31Mar and if anyone transited in the middle east then they have a minimum 14 day quarantine on arrival
• Iran – Suspension of entry of any non-U.S. citizen who has been in Iran in the previous 14 days
• Ireland – Nationwide shutdown of all schools and cultural institutions until 29Mar
• Israel – Everyone arriving will have to self-quarantine for 14 days
• Jordan – Will close its airports and borders until 31Mar
• Kuwait – Suspension of all flights to/from Kuwait indefinitely; they also are imposing a 2-week national holiday to close all workplaces to stop the spread of the virus (will end on 28Mar)
• Latvia – will go into national lockdown and closing airports and borders on 17Mar
• Lithuania – will close its borders and go into lockdown from 16Mar-30Mar
• New Zealand – Everyone arriving will have to self-quarantine for 14 days & cruise ships will be banned until 30Jun
• Malaysia – will go into national lockdown and close airports from 18-31Mar
• Norway – will close airports on 16Mar for 14 days
• Qatar – will close airports for 14 days
• Poland – Banning foreigners from entering the country and any returning citizens will have to self-quarantine for 14 days.  LOT Polish will suspend all flights for at least 10 days
• Saudi Arabia – Suspending all international flights for 2 weeks until 29Mar
• Spain – Imposing nationwide lockdown Monday for 14 days for 46m+ citizens
• United States – Suspension of entry for 30 days of any foreign national who has been in the Schengen border-free travel area (Austria; Belgium; Czech Republic; Denmark; Estonia; Finland; France; Germany; Greece; Hungary; Iceland; Italy; Latvia; Liechtenstein; Lithuania; Luxembourg; Malta; Netherlands; Norway; Poland; Portugal; Slovakia; Slovenia; Spain; Sweden and Switzerland) in the previous 14 days.  The US has also issued a Level 3 Health Advisory against international travel;Great Britain and Ireland added as well

Additionally, there are Travel Health Notices in place for the following countries with the recommendation that travelers avoid any non-essential travel due to COVID-19[2]:

• South Korea – Daegu
• Italy – Lombardy and Veneto; Italy has now quarantined the entire country for 66m+ people; no tourist visas until 4Apr

What have airlines done in response to COVID-19

Airlines within the USA & Canada have generally followed each other and implemented the same policies

Temporary reduction or cancellation of flights to/from China, Hong Kong, South Korea, Italy, & the United States

WHY?  Travel demand from countries where the outbreak first occurred or where the U.S. government has issued travel restrictions has fallen dramatically.  Airlines are adjusting their capacity to cope with this reduction in demand.

• United Airlines has been more aggressive in its Asia flight cancellations and reductions and has also trimmed Japan and Singapore
• Delta Air Lines has reduced capacity to Japan, South Korea, Italy and has suspended summer Seattle-Osaka service
• Air Canada has temporarily suspended its YYZ-HKG and YYZ/YUL/YVR-PEK/PVG flights

Waiving of change fees for future travel

WHY?  This removal of change fees was in response to a dramatic drop in bookings and was done to incentivize passengers to continue to book travel knowing they could change their plans later if they needed

JetBlue and Alaska were first to remove change fees on tickets purchased in early-March.  The Legacy airlines quickly followed in both the US and Canada.  JetBlue has now extended the waivers through Sept 8^th. Delta, American and United will now waive all change and cancellation fees on any ticket with travel dates from now through 31Mar

Reduction of flight schedules

WHY?  This is a direct response to greatly reduced demand for air service and it is expected that all other domestic U.S. & Canadian airlines will follow

• Aeromexico reduces international capacity by 40%
• airBaltic has suspended operations until 14Apr
• Air Canada expects Q2 capacity to be down 20% yoy, pacific capacity for April is down 75%
• Air France will ground all of their A380s and reduce capacity up to 90%
• Air New Zealand has cut capacity 10%; and will reduce workforce by up to 30%; capacity not expected to return fully for 12 months and now will cut LH capacity up to 85% over the next couple months
• Alaska Airlines will NOT reduce capacity for March/April but likely to reduce May capacity by 3.2%; now 10% in April and 15% in May
• American Airlines Reduce service to South America, including a suspension of flights to Argentina.  Retire its remaining 17 767-300ERs by May, and its 34 757-200s by Q4 2021.  Reducing international capacity by 75% year over year until May 6 and reducing domestic capacity by 20% and by 30% in May; will only operate 3 LH routes (DFWLHR, DFWNRT, LHRMIA) and they will park 135 widebody jets
• Austrian will suspend all operations starting the night of 18Mar
• Avianca will reduce capacity 30-40% effective immediately
• Delta Air Lines will cut system capacity by 40%, suspend all flying to continental Europe for at least 30 days, stop flying up to 300 aircraft, they will also cut capital investments by at least $2 billion and offering staff voluntary unpaid leave
• Finnair will suspend their US flights through 12Apr and cut capacity by 90%
• Hawaiian will cut capacity 8-10% in April & 15-20% in May
• JetBlue has announced they will be reducing 5% “in the near term”
• JetStar cutting capacity 8%
• KLM will retire their 747s by the end of March, reducing capacity in March 25% and 30-40% in April
• Korean will reduce global capacity by 80%
• La Compagnie will suspend operations through 12Apr
• LATAM Airlines will reduce international flights by 30%
• LOT Polish will suspend all flights for at least 14 days
• Lufthansa has grounded all 14 of their A380s through May and will cut capacity 50%; They still plan to fly their US routes during the 30-day ban for foreign nationals
• Norwegian Airlines will reduce long haul capacity by 40% and 25% for short haul; they will lay off 50% of their employees; they are now temporarily laying off 7,300 employees or 90% and cutting the schedule 85%
• Qantas will ground 38 aircraft and 8 A380s until September, cutting international capacity 25% through September, inaugural ORD-BNE delayed until Sept; 5% cut to domestic capacity
• Ryanair expects to reduce its capacity for April and May by up to 80%
• SAS will temporarily lay off 90% of workforce and suspend most operations until demand returns
• Spirit Airlines will reduce capacity by 5% for April
• United hiring freeze, corporate officers pay cut 50%, CEO 100% pay cut; 50% cut in capacity for April & May – expecting even with these cuts the LF will be only 20-30%
• Virgin Atlantic is reducing its schedule by 80% and parking 75% of its aircraft by 26Mar and 85% in April; permanently cancelling EWRLHR

Sales & loosening of award availability

WHY?  Similar to waiving change fees, these are tools meant to drive additional bookings and additional travel.

Other Considerations

• Airlines are implementing hiring freezes, postponing bonuses, CEOs are forgoing salaries, cancelling investor days and employee conferences and other measures to control costs as they see their revenue substantially impacted
• JFK/LGA/DCA Slot rules are being waived through 31May so airlines are not forced to fly to keep their slots and the EU slot restrictions are being waved until 1June
• Viking Cruise Lines (70 ships) will suspend all cruises through 30Apr and Princess Cruise Lines (18 ships) will suspend all cruises through 11May; Carnival Cruises, Royal Caribbean, Costa Cruises, MSC Cruises, Celebrity, Disney Cruises, Celestyal, Avalon Waterways, Windstar & AMA waterways also have suspended operations for 30 days; Norwegian, Regent Seven Seas, Oceania are suspended through 11Apr; Canada will not allow cruise ships over 500 passengers to dock until 1Jul
• Professional sports in the US will be suspended:  NBA & NHL suspended their season indefinitely; MLB has suspended spring training and will delay the start date of the season; MLS suspended games for 30 days, NHL.  The NCAA tournament is still scheduled to happen but with no crowds
• Disneyland, Walt Disney World, Disneyland Paris, Universal Studios Hollywood and Orlando, SeaWorld, LegoLand, and Six Flags will be closed through the end of the month
• Las Vegas Casinos have started to close including MGM resorts (Bellagio, MGM Grand, Mandalay Bay, The Mirage, Luxor, New York-New York, Excalibur, & Park MGM) & Wynn until further notice
• Vail Resorts which owns Vail, Beaver Creek, Breckenridge, Keystone and Crested Butte ski areas in Colorado (and 37 other properties around the world), will close for a week beginning Sunday at all its North American mountain resorts and Colorado Gov. Polis order all Colorado resorts to close for a week due to an outbreak

What impact will there be to air service in my community?

Airlines will continue to monitor and reduce capacity as needed in response to the decrease in demand that they see.  Airline schedules can be changed at a moment’s notice and everything is very fluid right now as the industry attempts to deal with the worst demand shock it has seen since the Great Recession.

Where can I learn more?

We’ve compiled a handful of reference links to further inform:

• IATA Updates Revenue Loss Forecasts; between $63B-$113B – March 5, 2020
• IATA: COVID-19 hits January passenger demand – March 4, 2020
• IATA Impact Assessment of COVID-19– March 5, 2020
• ARC: Bookings Drops for China, Italy, Japan and S. Korea – March 2, 2020
• COVID-19 travel restrictions
• CDC COVID-19 Information for Travel
• CDC travel notices
• CAPA Daily Update – March 10, 2020
• ACI Advisory Bulletin – March 10, 2020
• US Dept of State Travel Advisory – March 12, 2020
• OAG Understand the Schedule Changes and Manage the Impact – March 12, 2020
• DHS new procedures for returning Americans – March 15, 2020