Delta expects to add more flights in August but cautious on post-summer travel

Delta Air Lines plans to continue adding flights throughout the summer but executives remain cautious about expanding service after the peak summer season.

The Atlanta-based carrier expects to add around 1,000 flights a day in July and a similar number in August, CEO Ed Bastian said on a shareholder call Thursday. Its August domestic capacity would still be down between 55% and 60% from normal levels, he said. Delta earlier this month said its capacity in the second quarter was down 85% from a year ago.

After adding flights, Delta plans to “take a pause, and we’ll see how demand looks post-Labor Day before we decide to add further domestic flights back,” Bastian said.

Air travel has been ticking higher as the peak late-spring and summer travel season gets into full swing but the impact of the coronavirus pandemic has been deep and demand is a fraction of normal levels.

An average of 415,135 people a day were screened at U.S. airports in the first 16 days of June, according to the Transportation Security Administration. That’s close to four times the number screened in the same period of April, at the depths of the demand crisis, but down more than 83% from the same period a year ago.

Delta aims to eliminate its cash burn by the end of 2020, which he estimated at $30 million a day in June, down from $100 million a day in March.

The carrier cut operating costs by 55% in the second quarter and more than 40,000 of its employees — more than 40% of its workforce — have volunteered for temporary unpaid leaves, Bastian said.

U.S. passenger airlines with scheduled service had close to 7% fewer employees, or nearly 31,000 people, on their payrolls in mid-April compared with mid-March, largely because of voluntary leaves at Delta, according to data from the Department of Transportation released on Thursday. That brought the number of full-time equivalent workers at these U.S. carriers down to 428,569, the lowest since August 2017 and the first year-on-year decline in seven years, the DOT said. 

The airline has raised more than $14 billion since the start of March, excluding federal coronavirus relief, and is on track to have more than $10 billion in liquidity by the end of the year, Bastian said. 

He said that about 500 of Delta’s roughly 90,000 employees have contracted Covid-19, and while most have recovered, 10 have died.

JetBlue Airways, for its part, said Thursday that it plans to operate more than half of its regular summer capacity and that it will add 30 new domestic routes to cater to leisure travel demand.

“With business travel facing a less certain recovery timeline, the new routes offer JetBlue the opportunity to generate revenue, bring aircraft back into service that would otherwise sit idle, and add more flying opportunities for JetBlue crewmembers,” the New York-based airline said in a statement.

JetBlue is also planning to operate planes equipped with its Mint business-class service from Newark, New Jersey, to Los Angeles and San Francisco starting July 23.

Delta’s shares were down 1.3% in early-afternoon trading on Thursday, while JetBlue’s were off just under 1%.