United Airlines Reducing Capacity, Cutting Salaries

United Airlines is reducing capacity for April and May by 50 percent and cutting corporate officers’ salaries in half amid the global impact of the coronavirus (COVID-19) outbreak.

The airline’s CEO Oscar Munoz and President Scott Kirby shared the alarming numbers in a message to United’s nearly 100,000 employees late Sunday.

“As you know, March is typically our busiest month of the year. But this year, in just the first two weeks of March, we have welcomed more than one million fewer customers on board our aircraft than the same period last year,” the executives said. “We’re also currently projecting that revenue in March will be $1.5 billion lower than last March.”

“The bad news is that it’s getting worse. We expect both the number of customers and revenue to decline sharply in the days and weeks ahead.”

Last week, United announced that Munoz and Kirby would forgo their base salaries through June 30 following a dramatic decline in bookings.

Despite these efforts, the United brass also told employees that it anticipates the deep cuts to extend into the peak summer travel period. “We’re expecting load factors to drop into the 20-30 percent range—and that’s if things don’t get worse,” added Munoz and Kirby.

United’s decreased capacity and pay cuts are quickly becoming the new norm for the airline industry as governments impose travel bans and restrictions on the advice of medical experts.

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