CHICAGO - United Airlines warned its pilots this week of additional furloughs as fewer travelers have flown this summer amid a resurgence of coronavirus cases across the U.S.
The airline is preparing to furlough roughly a third of its pilots, or about 3,900, due to a worsening outlook for the airline industry, according to an internal memo sent July 30 by United's senior vice president for flight operations, Bryan Quigley.
United had previously warned of just 2,250 pilots possibly being furloughed from Oct. 1 through the end of 2020.
“In recent weeks, bookings have stalled and we continue to see an impact of the recent increase in COVID-19 cases on our business,” Quigley wrote in the memo. “Because of this we have had to reduce our schedule to accommodate lower demand. This is a very real reminder that hope is not a strategy – and that we need to be prepared for very low demand for a long time to come.”
The U.S. has experienced a resurgence of COVID-19 cases this summer, with more than 40 states seeing a spike at one point. As of July 31, cases are still rising in close to 30 states, according to data compiled by the New York Times.
As a result, many states like New York, Massachusetts and Rhode Island have imposed restrictions on visitors from the states that have reported high COVID-19 case counts — hurting hotels, airlines and other industries that depend on travel.
In the memo, Quigley warned that United does “not expect to improve any more than 50% of 2019 demand levels until a vaccine is available and mass produced.”
A Boeing 777-322ER from United Airlines takes off from the Brussels airport on July 29, 2020 in Zaventem, Belgium.(Photo by Thierry Monasse/Getty Images)
“We have built a plan to accommodate a significant reduction in business which would drive 3,900 furloughs, and that may not prove to be enough,” Quigley wrote. “If a vaccine is not readily available that will allow the world’s population to feel it is safe to return demand to normal, we will likely be in a 50% (year-over-year) demand scenario for longer than any of us hope or expect. This could drive more furloughs.”
United currently has 11,675 active pilots as of July 30, not including those currently on leave, the company said.
Other major airlines have warned of possible furloughs this year, including American Airlines, Delta Air Lines, Spirit Airlines and JetBlue Airways, once federal payroll-help money runs out as part of the roughly $2 trillion CARES Act — while Southwest Airlines said it did not plan to furlough or layoff any employees until at least 2021.
“There are really only two ways to mitigate the full impact of furloughs. The first is another stimulus bill,” Quigley said.
Congress is currently negotiating another coronavirus relief bill, which may include an extension to the $32 billion Payroll Support Program to keep airline employees on the payroll.
Quigley said the other way would be new agreements with unions “to reduce the cost until we see a return of demand to our business.”
Boeing said this week it slowed production for commercial jets, including its grounded 737 MAX and confirmed plans to discontinue the iconic 747 widebody, as dwindling demand from airline customers has reduced the need for more planes. The jetliner manufacturer said it now estimates it will take as long as three years for airline traffic to return to 2019 production levels.
This story was reported from Cincinnati.