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How United Airlins is trying to plan around a pandemic

When the coronavirus pandemic wiped out travel in the spring, United slashed its flight schedule, salted away aircraft in the New Mexico desert and parked planes at hangars around the country. That was the easy part. Now, with what is normally the peak summer season behind it and travel proceeding in fits and starts, the airline is continuing to fine-tune every facet of its business, from maintenance to flight planning, as it tries to predict where a wary public will fly, a challenge even in the best of times. “We can really throw away the crystal ball, which was hazy to begin with,” said Ankit Gupta, United’s VP for domestic network planning. This week, the airline announced a $1.8b loss during Q3, with revenues down 78% compared to the same period a year ago. While United said it was ready to “turn the page” from survival to rebuilding, it said it didn’t expect a recovery to begin in earnest until 2022. Passenger volumes for US airlines are down about 65%, according to an industry group, and major carriers have taken on enormous debt as they lose billions of dollars each month. After hopes for a second congressional rescue package faded last month, United furloughed more than 13,000 workers and American Airlines furloughed 19,000. But while every airline is struggling, each struggles in its own way. United relies far more than its rivals on international travel, which is deeply depressed and is expected to take far longer than domestic travel to bounce back. Lucrative business travel will be slow to return, too, and the airline said this week that it had amassed more than $19b in cash and other available funds to cope with the downturn. “We’ve got 12 to 15 months of pain, sacrifice and difficulty ahead,” United’s CE, Scott Kirby, said on an earnings conference call on Thursday. “But we have done what it takes in the initial phases to have confidence — it’s really about confidence — in getting through the crisis and to the other side.” In navigating that path, the airline has focused on finding savings while positioning itself to serve the few passengers who still want to fly. Story has more.<br/>

United CEO: ‘We’ve turned the corner,’ but a full recovery still years away

United Airlines’ CEO Scott Kirby on Thursday said he expects air travel demand to remain lower than normal until there’s a widely available coronavirus vaccine, but that the worst appears to be over. “We think we’ve turned the corner and can see it,” Kirby said. A recovery is still “a long way off,” Kirby said, adding that demand “is not going to get anywhere close to normal until there’s a widely available vaccine.” He estimates that will be at the end of 2021. United shares fell 3.8% Thursday to end the day at $34.25. Other major airlines fell more than 1% each. After the market closed Wednesday, the carrier reported it lost $1.8b in Q3. But bookings are returning but slowly. “I would say over the last eight weeks or so, we’ve domestically have seen just steady progress,” Andrew Nocella, United’s CCO, said on the company’s quarterly earnings call Thursday. The pandemic has caused outsize damage to international and corporate travel demand, once lucrative pillars of big airlines’ like United, Delta and American. CEO Kirby said Thursday Carriers are now fighting over a smaller pool of leisure travelers. They’re refocusing their networks to build up service to beach and mountain destinations and loosening ticket policies to entice these price-sensitive consumers to book. The crisis is also prompting some strategy shifts in the industry as executives eye a rebound, even though it’s still distant. United plans to relaunch service at New York’s John F. Kennedy International Airport next year, Kirby said Thursday. The move takes advantage of the lull in air traffic to grab space at what is normally one of the country’s most congested airports. “I look forward to getting back and competing aggressively” for cross-country travelers, Kirby said. <br/>

Coronavirus exposure risk on airplanes very low, US defense study finds

The risk of exposure to the coronavirus on flights is very low, a US Department of Defense study released Thursday found, a positive sign for the airline industry as it tries to rebound from the pandemic’s crushing effect on travel. When a seated passenger is wearing a mask, an average 0.003% of air particles within the breathing zone around a person’s head are infectious, even when every seat is occupied, it found. The testing assumed only one infected person on the plane and did not simulate the effects of passenger movement around the cabin. The study, conducted aboard United Boeing 777 and 767 aircraft, showed that masks helped minimize exposure to infection when someone coughed, even in neighboring seats. About 99.99% of particles were filtered out of the cabin within 6 minutes due to fast air circulation, downward air ventilation and the filtration systems on the aircraft. It estimated that to receive an infectious dose, a passenger would need to fly 54 hours on a plane with an infectious person. United, which also provided pilots for the test, took pains to present the results in its favor. “These results ... mean your chances of COVID exposure on a United aircraft are nearly non-existent, even if your flight is full,” said United Airlines Chief Customer Officer Toby Enqvist. The study was led and funded by Transportation Command, which operates Patriot Express flights that use commercial planes like United’s for members of the military and their families. The research over six months involved 300 tests during 38 hours of flight time and 45 hours of ground testing. It was done by releasing particles the same size as the novel coronavirus across the entire cabin by section, each of which had 42 sensors representing other passengers who could potentially come in contact with the particles.<br/>

SIA Group passenger carriage down 98.1% in September amid ‘soft’ demand for air travel

The Singapore Airlines Group suffered a 98.1% year-on-year decline in passenger carriage in September, even as Singapore opened its borders to more places. “Demand for air travel continued to remain soft as border controls and strict travel restrictions remained in place in most countries to curb the spread of COVID-19,” the group said as it published its September operating results on Thursday. Lower overall passenger carriage in September resulted in a group passenger load factor (PLF) of 17.2%, representing an almost 68 point drop from last year. SIA Group's passenger capacity was down by 90.8% year-on-year. Meanwhile for SIA itself, capacity was 88.9% lower compared to last year’s. In September, SIA's network, which was described as "skeletal", connected Singapore to 30 metro cities. This was up from the 28 in August, after adding Surabaya and Taipei. SIA's passenger carriage also declined 97.7%, resulting in a PLF of 17.4%. Meanwhile SilkAir's passenger carriage decreased by 99.1% year-on-year against a 98.1% cut in capacity, the group said, adding that the PLF was 37.1%. “SilkAir continued to operate flights to Cebu, Chongqing, Kuala Lumpur and Medan, and added Phnom Penh to the list of destinations served,” the group noted. Cargo load factor was 29.5 percentage points higher year-on-year as the capacity contraction of 59.4% year-on-year outpaced the 39.3% decline in cargo traffic (measured in freight tonne-kilometres), said the group. It added all route regions recorded year-on-year increases in cargo load factor last month. Despite the results, SIA Group noted there were “positive developments” for them as the Government gradually reopened its borders to some places.<br/>

Air New Zealand outlines ‘safe travel zone’ ops to Australia

Air New Zealand has outlined its operations under a bilateral “safe travel zone” arrangement that allows one-way quarantine-free travel from New Zealand to Australia, starting Friday. The carrier currently operates eight return flights between Auckland and Sydney each week, and is looking to operate six of these as quarantine-free flights. Air New Zealand’s CE Greg Foran says that defining quarantine and quarantine-free flights are key to carrying passengers safely and identifying those with travel not originating in New Zealand. “The quarantine-free flights will be for travellers originating from New Zealand who are flying from Auckland to Sydney and are not required to quarantine on arrival in Australia. Quarantine flights will be open to passengers who do not meet the ‘Safe Travel Zone’ criteria and will be required to quarantine on arrival in Australia.” Passengers travelling from New Zealand will have to declare that they were in New Zealand the 14 days before travel and are subject to health screening upon arrival in Sydney. At the initial stage, this arrangement only allows for travel to Australia’s New South Wales, where Sydney is the state capital, and the Northern Territory. Under Australian State restrictions, Air New Zealand is not taking bookings for travel beyond Sydney to destinations within Australia. Separately, the New Zealand government requires returning travellers to quarantine for 14 days upon arrival.<br/>