Delta To Retire 777 Fleet
Kate O'ConnorMay 14, 20205
Image: Delta
Delta CEO Ed Bastian announced on Thursday that the airline will permanently retire its Boeing 777 fleet by the end of the year. According to Bastian, the decision was made due to the drop in travel demand caused by the coronavirus (COVID-19) pandemic. Following the retirement of its 18 777s, Delta’s long-haul routes will be flown exclusively by the company’s A330s and A350-900s. The airline previously announced plans to accelerate retirement of its MD-88s and MD-90s to June 2020.
“Our principal financial goal for 2020 is to reduce our cash burn to zero by the end of the year, which will mean, for the next two to three years, a smaller network, fleet and operation in response to substantially reduced customer demand,” Bastian said in a memo to employees. “An important tool to help us achieve these goals is retiring older aircraft and modernizing our fleet as we plan for the future.”
Delta has more than 650 aircraft parked due to the pandemic and resultant economic slowdown. The airline reported that more than 41,000 employees have taken voluntary leaves of absence and customer refunds amounting to over $1.2 billion have been issued since the crisis began. Bastian noted that Delta is currently burning about $50 million a day.
Delta
wrestles with too many pilots, too many planes
Delta Air Lines sounded two alarms Thursday - in an indication of the deep
struggle facing the entire airline industry.
America's biggest airline warned it could have 7,000 more pilots than needed in
the fall, according to a memo to flight operations employees seen exclusively
by Reuters.
That warning hints at a likely wave of layoffs since Delta has more than 14,000
pilots currently in its workforce. But Delta can't cut any staff until October
1st as part of the financial aid agreement it made with the Treasury.
The memo was sent out on the same day Delta announced that it would stop flying
all Boeing 777 wide-body jets and would retire some other older
high-maintenance planes in an effort to slow down its cash burn. Delta instead
will turn to Boeing rival Airbus for more fuel and cost-efficient planes for
long-haul flights. But those purchases will only come when ticket sales start
to rebound.
That's not good news for Boeing - its shares were down Thursday.
Delta, considered one of the best run airlines in America, is looking for ways
to ease a cash burn as travelers stay on the ground in droves.
American Airlines has also announced a large fleet retirement and United Airlines
has told its pilots to brace for changes.
Recent data showed U.S. airline passenger numbers plunged in recent months -
forcing airlines like Delta to cut back on flights.
And it's not clear when the flying public will return. Reuters has learned that
some airlines will require face-masks at ticket-counters and plane boarding,
but will not enforce the measure once the plane leaves the ground. That could
leave some passengers wary of boarding a crowded plane.
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