American Airlines is planning to drop flights to up to 30 smaller U.S. cities if a federal requirement to continue those flights expires at the end of next month, an airline official familiar with the matter said Thursday.
American agreed to keep serving those smaller cities as a condition of receiving $5.8 billion in federal payroll help this spring. However, the money and the requirement to serve those destinations both expire Sept. 30 unless they are extended.
The move by American could put more pressure on Congress and the White House to give passenger airlines another $25 billion for labor costs. Airline unions and the airlines, which are struggling with a steep downturn in revenue as the pandemic undercuts air travel, are lobbying Congress for the money.
The American Airlines official did not detail which cities could lose service, but the changes could appear in schedules as early as next week. The person spoke on condition of anonymity to discuss planning that has not been made public. Americans plans were first reported by CNBC.
In March, Congress and President Donald Trump approved up to $50 billion for passenger airlines, including $25 billion in grants and loans to help cover labor costs through September.
The idea was that the virus outbreak might subside enough by fall for the airlines to stabilize on their own. However, U.S. air travel has recovered much more slowly than hoped.
After falling 95% in April, air travel in the U.S. has remained down more than 70% in August, compared with a year ago, according to Transportation Security Administration figures. Combined, the nations four biggest airlines American, Delta, United and Southwest lost more than $10 billion in the second quarter, and the third quarter is likely to be only modestly better.
Airlines and their labor unions have been lobbying for the money to be included in a new round of pandemic relief to prevent layoffs in the industry until next April. They have lined up support from more than half the members of the House, including more than two dozen Republicans, and from more than a dozen Republican senators.
Trump spoke favorably of helping airlines when asked about the issue at a news briefing last week.
Obviously the airline business is not doing very well, he said. I would be certainly in favor. We can’t lose our transportation system.
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