American Airlines’ domestic schedule will soon exceed 50% of its prior-year level for the first time since the coronavirus pandemic hammered travel demand.
The airline will in July and August operate 55% of the domestic schedule it operated during the same period in 2019. In June, American’s domestic schedule is 30% of what it was in June 2019.
Fort Worth-based American says that steadily improving demand for domestic air travel in May has prompted it to increase for July and August the frequency of flights from Dallas/Fort Worth and Charlotte to cities in Florida and along the Gulf Coast as well as mountain destinations.
During April, when demand vanished during the first full month of shutdowns in the USA, American reduced its system capacity by 80% and operated 35% of the number of domestic flights it had operated in April 2019. The average daily domestic passengers flown in April was 32,154, and the average load factor 15%.
Searches for flights on American’s website and conversions to bookings both began to increase in early May, as some states started to contemplate reopening. The bulk of the searches were for beach destinations in Florida or California or for Las Vegas, Orlando, national parks, or the Caribbean.
“Once markets in the south and the southwest started to really reopen, then we saw bookings pick up in the weeks before Memorial Day and in the weeks after it,” Vasu Raja, American’s senior vice-president of network strategy, tells Cirium. “Those states that have reopened almost fully have the most vertical recovery rate.”
A month ago, net bookings for American were down 100%. As of 3 June, net bookings are down by 70%. “In those states across the south and the southwest, where they’ve reopened more fully, our net bookings are down 40% or so. That gives you a sense for just how different it is between the more lightly opened states in the northeast or the West Coast versus those in the south or Southwest that have reopened more fully.”
American operated 20% of its schedule during the first three weeks of May, with 78,718 average daily passengers and a load factor of 41%. While still operating 20% of its domestic schedule during the last week of May, the average daily passengers increased to 110,330 and the load factor reached 55%.
Raja declines to specify a load-factor target for July and August. Instead, he views the summertime network expansion as an experiment with a new product: an air transport and hotel experience transformed by the wearing of masks, plexiglass separators, and social distancing. As with any new product or technology, as early adopters get comfortable with it, the rest of the population may follow.
“Our bet on July is that this tenuous recovery gains a little more steam,” Raja says. “If it doesn’t materialise for whatever reason, we still have the flexibility to reduce our schedule in July. But if there’s an opportunity to go and serve those customers, we want to be able to do that.”
Unlike domestic demand, international travel demand has not budged notably and will remain down by 80% in June and July, although American is restoring eight international routes in June. Those routes include Dallas/Fort Worth to Amsterdam, Paris Charles de Gaulle and Frankfurt Main; Miami International to Antigua, Guayaquil and Quito; O’Hare International to London Heathrow; and New York JFK to London Heathrow.
