American Airlines is preparing to scrap flights serving two-dozen medium and small cities as the expiration of federal coronavirus aid that placed restrictions on carriers from cutting service approaches, according to an executive at the carrier, speaking to CNBC.
Airlines are required to maintain minimum levels of service until September 30 under a $25 billion federal aid package that also prohibited layoffs through the end of the third quarter. American was granted $5.8 billion in support under the program.
The deal was meant to preserve both jobs by providing payroll assistance and air service around the country, even though most planes were flying with a fraction of their normal passenger loads. Regulators allowed airlines some exemptions in service.
The new cancellations for up to 30 destinations could show up in fall schedules as early as next week, the American Airlines executive told CNBC. The person asked not to be identified because the changes haven’t been finalised yet.
Airline labor unions and executives from carriers themselves have been pushing Congress for another $25 billion in payroll support to keep paying workers through the end of next March, as demand remains depressed.