Mar 13, 2020 - Economy & Business

Delta cuts capacity deeper than post-9/11 levels due to coronavirus

Photo: George Frey/Getty Images

Delta Airlines announced Friday it will reduce its flight capacity by 40% for the next four months due to the coronavirus outbreak, a dramatic increase from its original 15% reduction.

The big picture: It's a deeper cut to capacity than Delta instituted after the Sept. 11 attacks. The airline industry has had to curb flights as it grapples with lack of demand, as Americans are advised to avoid nonessential travel. Delta CEO Ed Bastian will also forgo his entire salary for the year.

“I ask all of you to see what you can do to help us save cash," Bastian wrote in an internal memo. He noted several more changes:

  • All flights to Europe except London will be halted for at least 30 days.
  • Reducing capital expenditures for the year by $2 billion.
  • "Offering short-term, unpaid leaves" and a hiring freeze.
  • Substantial reduction in contractors and consultants.

Go deeper: Coronavirus rattles travelers — and airlines

Go deeper

Air-travel industry group: Coronavirus could cost airlines $113B

Photo: Marina Lystseva\TASS via Getty Images

The coronavirus outbreak could cost airlines up to $113 billion in lost revenue from declines in air travel in the spring and early summer, the International Air Transport Association said Thursday in a press release.

Why it matters: The IATA estimates that airlines could experience a 19% loss in passenger revenues if the virus extensively spreads in countries that now have 10 or more confirmed cases as of March 2.

A lifeline emerges for the devastated airline industry

American Airlines planes parked at Los Angeles International Airport. Photo: Alex Tai/SOPA Images/LightRocket via Getty Images

Congress' massive $2 trillion coronavirus stimulus package includes $58 billion for U.S. airlines, half in grants to cover 750,000 employees' paychecks, and the rest in loans or loan guarantees to help them keep operating during the worst travel downturn in history.

Why it matters: With some 80 million U.S. residents under mandatory stay-at-home orders and the coronavirus pandemic continuing to spread, hardly anyone is flying these days. But when the public health crisis ends, airlines want to be able to take off again quickly.