United Airlines has reported a shocking 70% drop in domestic reservation demand during the past few days and has said it will make additional cuts in the coming months to adjust to demand.
The net bookings for United Airlines (new reservations minus cancellations), have collapsed in both Europe and in Asia. Domestic net bookings are down 70% and gross bookings are down 25% at the time of this publishing.
The CEO of United Airline’s view of the Coronavirus situation is one of the ugliest yet. The airline and their competitors are rushing to cut costs and preserve liquidity until things improve.
A number of CEO’s for airlines in the United States are confident that they will weather this storm. Many airlines have multiple revenue streams like online shopping, co-branded credit cards, hotels, and more.
United Airlines has stated that they will cut flights in May by 20% and each month after that will be the same or larger until demand returns.
Airlines outside of the United States may not survive the Coronavirus crisis due to their weaker balance sheets or lack of cash reserves.