US airlines see distant recovery as coronoavirus hits travel

Leading US airlines Tuesday ditched 2020 forecasts and unveiled more sweeping capacity cuts and cost-saving measures in response to the spreading coronavirus, while United warned of a deep hit to the sector. United President Scott Kirby said he was preparing for a “dire scenario” under which revenue could fall as much as 70% in April and May and 20% in November and December. United has taken some of the most aggressive measures to date, saying on Tuesday it had raised $2b in new capital to bring liquidity to $8b and slashed its 2020 capital expenditure by more than a third to about $4.5b. “Let me blunt. Speaking for United, hope is not a strategy,” Kirby told investors, saying it could take 18 months for demand to recover. United is not taking jet deliveries for the time being and will not add capacity back to the market until it sees demand returning, he said. The airline expects to post a first-quarter loss due to the crisis, and Kirby and CEO Oscar Munoz are forgoing their base salaries until June 30. Delta said it had seen net bookings fall by as much as 25% to 30% and expected the situation to worsen further. “This clearly is not an economic event. This is a fear event, probably more akin to what we saw at 9/11 than necessarily what we saw in 2009,” Delta CE Ed Bastian said. Delta is cutting domestic capacity by 10% to 15% and international by 20% to 25% and freezing hiring across the company, offering voluntary leave options to staff and looking at early retirement of older aircraft. Southwest CEO Gary Kelly told employees he was taking a 10% pay cut in response to the crisis, which it said last week could wipe up to $300m from its Q1 operating revenue.<br/>