Delta Air Lines unveils strategy to address coronavirus impact, to reduce Pacific capacity by 65%

Delta Air Lines announced (10-Mar-2020) it is immediately reducing capacity and introducing cost reductions and cash flow initiatives across the company, in order to address the negative impact of coronavirus on travel demand. The airline is organising a hiring freeze, offering voluntary leave, parking aircraft and considering early retirement of older aircraft. It is likewise suspending share repurchases and deferring USD500 million in CAPEX and USD500 million in voluntary pension funding. Capacity cuts are as follows:

• Pacific: -65%;
• Trans Atlantic: -15% to -20%;
• Domestic: -10% to -15%;
• Latin America: -5%.

However, the carrier has recognised an expense benefit of approximately USD2 billion from the fuel price decline and CEO Ed Bastian said it is "well positioned to manage this challenge". It anticipates liquidity of at least USD5 billion by the end of 1Q2020, and maintains approximately USD20 billion in unencumbered assets, including USD12 billion in aircraft. [more - original PR]