Coronavirus pushes U.S. airlines to the brink of some form of shutdown

At 9:25 am on Tuesday, September 11, 2001, airplanes in the United States were ordered to stop flying. The rapid airspace stand-down came in the middle of the four hijackings that forever changed aviation. The Federal Aviation Administration first ordered a national ground stop. Fifty-six minutes later, all inbound international flights were to be diverted. No aircraft would be allowed to fly and by early afternoon, the skies over the continental U.S. were emptied of civilian flights.

The decision to halt air traffic after the attacks was swift and ordered by a singular authority. Two decades later, the U.S. aviation system is day-by-day rolling closer to operating as a mere shadow of its former self as the nation reels from the spread of the novel coronavirus. What’s less clear is whether or not a freeze will come at the hands of government intervention, market forces or even by action taken by the aviation workforce, according to interviews with U.S. and international airline and aerospace industry leaders, labor and congressional officials.

Related: Coronavirus is seizing the engine of global commercial aviation

U.S. President Donald Trump told reporters during a White House news briefing that the administration was considering moves to restrict domestic air travel. Trump did not provide any specifics or a timeline for implementation.

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“We’re working with the states, and we’re considering other restrictions,” he said on Saturday. The administration also expanded its European travel restrictions beyond the initial Schengen Area countries, adding the U.K. and Ireland to the ban starting midnight on March 16. Trump on Friday, when asked if people should avoid domestic air travel, said, “If you stay home, it’s not bad, it’s not bad.”

Across aviation, airlines, governments, plane makers and their suppliers are evaluating a range of possible scenarios, according to executives, preparing for further transportation disruption as the U.S. tries to contain the spread of COVID-19 around the country.

“It makes a lot more sense doing [a ban] domestically than internationally” if you’re trying to prevent community transmission of the virus, one senior U.S. elected official told The Air Current.

Options may range from a two-week shutdown of air travel in some east and west coast states or select hubs all the way through a worst-case extended national halt, airline planners and officials say. Notably, these airlines are gaming out scenarios, not creating action plans for their implementation, which the officials note is an important difference.

Related: As coronavirus pummels air travel, lessons from 9/11 on what may come next

“A massive cut-back in capacity feels inevitable. I can’t get my arms around how airlines would go into full shut-down at this point,” said one aerospace industry chief executive who has been regular contact with U.S. airlines since the crisis began.

“I think everybody is making that assumption” that some form of a halt is coming, said one senior U.S. airline leader, but the challenge is “the uncertainty of what does this look like?”

Elsewhere in the travel and tourism business, the U.S. cruise ship industry said Friday it was taking a 60-day pause in operations, which it described as “voluntary.”

Global drawdown

This is not without recent precedent. Air traffic inside China contracted by as much 80% at its 25 busiest airports as it grappled with the outbreak that began in Wuhan, a city of more than 11 million people, according to tracking by Flightradar24. It reduced the second largest aviation market on the planet behind the U.S., to the equivalent traffic of a country with the population of Portugal.

The same is happening in Italy, the hardest hit country outside of China. Milan’s Linate Airport will be temporarily closed starting Monday, shifting commercial aviation traffic to Terminal 2 at Malpensa Airport.

Resource: IATA complete list of country-by-country travel restrictions

Governments around the world are moving to shut down cross-border air travel. Come Monday morning, Norway will bar international traffic to its airports. In eastern Europe, Ukraine will shut off its air traffic system, as has Poland and Latvia for all international flying. In the Philippines, all air travel to and from Manila is suspended until mid-April. New Zealand’s government ordered everyone traveling from overseas to self-isolate. Air New Zealand said it will “adjust its capacity accordingly.” A person familiar with Air New Zealand’s operations says that the self-quarantine order will put enormous strain on the availability of flight and cabin crews returning from trips abroad.

“I make no apologies. This is an unprecedented time,” said New Zealand Prime Minister Jacinda Ardern.

Supply and demand

One top safety official at a U.S. west coast airport said earlier this week he didn’t believe that there would be a state or federal directive to reduce commercial service because of the potential backlash from operators. “I believe the reduction in aircraft operations would be the basic laws of supply and demand,” the official said earlier this week. “If people are taking their own precautionary measures to limit their exposure then the airlines can only fly for so long with partially full planes. So they will have to weigh the return on investment to keep offering routes that are not making any money.”

Related: Once scarce, coronavirus creates a glut of unneeded airliners

By the close of this week, American Airlines said it would slash its international summer season capacity by 34%, including halving in April its transatlantic operations. Delta Air Lines on Friday announced a 40% reduction in its flying capacity with plans to park more than 300 aircraft, so far the most drastic of any U.S. airline. American is likely to follow with additional cuts, said one airline official.

UPDATE: American later Saturday announced it would reduce international flying capacity by 75%, suspending all long-haul flights to Asia, Australia, New Zealand and South America. The changes will also ground nearly its entire twin-aisle jetliner fleet, approximately 135 of its 149 aircraft, until May 6.

The financial hit has been acute and growing. U.S. airline CEOs had a collective conference call with industry trade group Airlines for America (A4A) to discuss a probable aid package, according to two people. One described the conversation in the terms of an “aid” package, the other in terms of an industry “stimulus.” A4A did not respond to a request for comment. No consensus was reached during the call, said one of the people. The senior member of congress and one senior airline leader said if airlines were asked by the Trump Administration to plan a range of scenarios, that could inform the magnitude of an incoming aid package.

In the wake of the West African Ebola epidemic in 2015, the U.S. Government Accountability Office published a study that noted that the 14 airports and three airlines involved “have plans for responding to communicable disease threats from abroad…the United States lacks a comprehensive national aviation-preparedness plan aimed at preventing and containing the spread of diseases through air travel.”

The GAO concluded that as of March 2018, “the Department of Transportation (DOT) has not developed a national aviation-preparedness plan to respond to communicable disease threats from abroad.”

By all accounts, U.S. airlines responding to the crisis development-by-development is happening in real time, with conflicting and often confusing policy decisions, like the U.S.-European travel restrictions, that caught the industry off guard.

“You can’t plan,” said Sara Nelson, International President of the Association of Flight Attendants-CWA in an interview with The Air Current on Thursday.

Related: A jittery industry begins to question if business travel will rebound after coronavirus

While no U.S. flight attendants have tested positive for COVID-19, the Allied Pilots Association representing pilots at American, said in a note to its membership on Thursday that one of its DFW-based pilots “has tested positive for the coronavirus and is undergoing treatment.”

Even if governments or natural economics don’t drastically scale back flying in the U.S., labor groups have the power to as well. “Airlines have been dealing with this longer than any other businesses in the United States and flight attendants have been on the front line of dealing with the coronavirus longer than maybe any other profession.”

AFA’s Nelson is acutely aware of the membership’s power to shut down the system and takes that responsibility “very seriously”, but won’t do that. “If we believed that going to work was unsafe, we wouldn’t do it,” she said. “That is not what we believe. And we’re in a position here where this is being taken out of our hands and people are not traveling.”

Write to Jon Ostrower at jon@theaircurrent.com