As part of securing billions of dollars in financing from the federal government US airlines must continue operating flights to all domestic destinations currently served. As part of an Order to Show Cause issued on Tuesday the Department of Transportation announced that, while frequencies and route options may be reduced, the destinations served must remain at prior levels to ensure connectivity within the national airspace. In total the Department identified 592 points that qualify for such service obligations.
Airlines will not be permitted to coordinate their operations in maintaining this service. Over the weekend it was rumored that airlines might create an unprecedented inter-carrier codesharing operation to reduce capacity on overserved routes. The DOT filing clearly indicates, “These provisions do not authorize any coordination among air carriers that would violate the antitrust laws.” That would preclude the increased cooperation.
Reducing frequencies, not destinations
The ability to cut frequencies and route diversity is critical to the airlines as they slash capacity to contend with the new normal of minimal air traffic demand in the US market today. To that end, any destination served 5 or more days per week will be required to maintain service on at least five days. Destinations served less frequently can drop to a single weekly flight.
Moreover, a destination served from multiple other points in a carriers network need not maintain all those routes. Just one is necessary. Or the airline can choose to vary the routes, running from a spoke destination to different hubs throughout the week so long as the aggregate number of flights is five or more.
Airlines will have the option to aggregate flight frequencies in markets rather than individual airports. For larger metropolitan airports this will allow for consolidation of services. New York City (EWR/JFK/LGA/HPN); Miami (MIA/FLL); Washington, DC (IAD/DCA/BWI); Houston (HOU/IAH); Dallas (DFW/DAL); Los Angeles (LAX/LGB/SNA/BUR); and San Francisco (SFO/OAK/SJC) are among the metro areas considered a single market in this context.
There are also notable exceptions to the single market rule, with Everett, Washington not considered part of the Seattle market. Similarly, neither Melbourne nor Sanford, Florida are not seen as part of the Orlando market under the ruling, despite advertising themselves as options for Orlando.
The DOT stops short of suggesting that some of these markets should consolidate operations to fewer airports or terminals, though that could also be beneficial to all parties involved.
In some ways the requirement to continue service harkens back to the Civil Aeronautics Board (CAB) era and federal regulation on what routes must operate and what the fares would be. This move does not purport to set fares and leaves far more flexibility to airlines than the CAB once did, but the requirement to not reduce service on existing routes does read somewhat similarly to the CAB version. In both cases direct appeals to the government could permit such changes if the Department determines it acceptable.
Airlines that accept funding under the CARES act are required to maintain the service levels until 30 September 2020, in line with the similar staffing requirements to receive the funds. Regional carriers are also eligible for the funding but generally have no say in the routes they operate on behalf of mainline carriers. To address that the DOT allows that a “Service Obligation will be considered met if it is operating all flights designated by its mainline affiliate, consistent with the mainline carrier’s Service Obligation.” If a mainline carrier does not require operations from its regional it could sit fully idle and still be considered in compliance, so long as the mainline carrier is otherwise meeting its obligations.
A reasonable compromise?
The rules provide for airlines to dramatically reduce operations without abandoning any markets. They also require that the airlines continue to compete. Short of the DOT explicitly either shutting down commercial aviation or fully taking over the airlines’ route planning and revenue management tasks for some duration (neither of which is appealing for many reasons) this approach delivers a reasonable compromise.
Southwest Airlines intends to cut capacity by 40% in May, but did not indicate any destinations to be removed from its map. United Airlines, Delta Air Lines, American Airlines and JetBlue all plan major capacity cuts but, for now, are not removing any airports from their service. Other airlines are taking a different approach, however, that could present challenges. Spirit Airlines will halt operations in the New York City area, a move that would render it ineligible for the CARES act aid but in support of the CDC’s policies. Hawaiian Airlines slashed nearly all of its mainland routes as the Hawaiian government implemented a mandatory quarantine rule. How some of these issues are reconciled remains to be seen.
For a (generally) up-to-date listing of airlines and their operational levels check out this spreadsheet maintained by PaxEx.Aero and other industry experts.
More on COVID-19 and the airlines affected
- Alaska Airlines offers elite bonus earning in face of COVID-19 booking weakness
- Massive cuts, uncertain recovery timelines for aviation in the face of COVID-19
- Qantas cuts international 25% through September facing coronavirus-induced demand drop
- Spirit Airlines plans 5% growth reduction for April as COVID-19 hurts demand
- American Airlines slashes schedule, increases flexibility for customer rebookings
- US to block some European visitors
- Two key takeaways from American’s latest schedule cuts
- Regulators suspend slot rules, opening door to deeper airline cuts
- Beyond route cuts, airlines initiate extended suspension of operations
- Gogo looks to ride out coronavirus-related dip in demand
- Trans States Airlines: The first US airline victim of COVID-19
- JetBlue removes 40% of capacity, delays new deliveries as demand drops
- Airlines get a break on coronavirus EC261 comp, looking for more
- Airport lounges shutter as airlines slash capacity
- Will COVID-19 delay the opening of Berlin Brandenburg Airport?
- Qatar Airways plans 75% capacity cut in response to COVID-19
- Emirates, Turkish Airlines slash route networks, ground aircraft
- JetBlue plans additional draw down in service
- Is it time for US airports to start closing terminals??
- Converting to cargo: Putting passenger planes to use in the COVID-19 era
- IATA anticipates recession, slower recovery, as COVID-19 impact drag on
- US carriers cut frequencies, not destinations as they seek federal funding
- JetBlue plans 70%+ cut in April operations
- Cancelled flights, vouchers and the airline cash flow crunch
- Spirit Airlines reportedly cutting 90% of flights
- US airlines cut deep, but not deep enough
- An eerie quiet over New York City: The flights are gone
- Who wants what? How the US airlines are responding with CARES Act funding on the line
- Delta, United extend elite status by a year, adjust other benefits
- DOT adjusts, finalizes airline route requirements for CARES Act funding.
- Lufthansa announces major, permanent fleet restructuring
- Air Canada, Alaska Airlines extend elite status
- Deeper cuts, reprotect options coming for JetBlue
- Air Canada replaces seats with cargo in 777-300ER cabin
- American Airlines extends status, eases qualification
- A new take on amenity kits in the COVID-19 era
- COVID crushing inflight connectivity: Part 1
- Stuck in the past, DOT botches its CARES Act implementation
- DOT grants exemptions to Delta, Alaska Airlines, Hawaiian Airlines under CARES Act obligations
- Introducing yin-yang seating for economy class
- Inflight social distancing will kill short-haul LCC travel: IATA
- Gogo furloughs 60% of workforce, applies for CARES Act support
- COVID crushing inflight connectivity: Part 2
- De Havilland, Air Canada Cargo partner on Dash 8-400 cargo conversion
- JetBlue plans new route network for CARES Act compliance
- Spirit Airlines running triangle routes to meet CARES Act requirements
- Sun Country wins big as United, Frontier lose in latest CARES Act ruling
- Frontier Airlines pushes new route plan for CARES Act compliance
- Argentina plans to restart flights in September 2020
- Spirit Airlines asks DOT again to drop destinations
- Delta Flight Products, TechOps develop isolation pod for COVID-19 military transport
- JetBlue aims to drop 16 "major hub" destinations from its network
- Allegiant scores leniency from DOT in CARES Act obligations
- Panasonic Avionics implements furloughs to address slowing business
- American, Delta confirm accelerated fleet retirements
- Airbus aims to ease "COVID Combi" temporary freighter conversions
- The Weekly Wrap: FlightPlan, personal screening and more!
- United’s long-haul operations focus on a new "workhorse"
- United plans touchless bag tag kiosks
- Temperature scans in, 767s out for Air Canada, Rouge
- JetBlue, Spirit score exemptions to drop service at major US airports
- IATA recommends against blocked middle seats, favors "layered" protections
- United plans to resume (cargo for now) Hong Kong-Singapore service
- JetBlue suspends six cities through June
- Project Wingman USA Opens Lounges for Frontline Healthcare Heroes at Two Major New York City Hospitals
- Cape Air’s ugly April stats (and some possible good news for May)
- Fighting for the middle: A pandemic seating shift
- Avianca declares bankruptcy, seeks protection in restructuring
- United raises ire in cutting hours for salaried employees
- DOT further relaxes airline CARES Act obligations
- Allegiant sees quick recovery on the horizon
- Delta drops 777 fleet as coronavirus cuts continue
- JetBlue offers free TrueBlue Mosaic status, plus a year extension
- United faces lawsuit over M&A employees pay cut
- Optimism on the horizon: The Weekly Wrap 15 May 2020
- Beached Whale: A380’s future turns more bleak
- TSA implementing lower-touch screening protocols
- Volotea plans for growth into a COVID-affected Summer
- Health passports in our future: The Weekly Wrap
- LATAM seeks US bankruptcy protection, plans to continue operations
- JetBlue plans return of international markets in June
- Frontier, Mobile bicker over flights to Orlando
- US retaliates against China, blocking all flights
- China blinks, US to back down on flight ban
- ATPCO moves to ease ticketing changes for airlines worldwide
- Inflight magazines are not dead yet: The Weekly Wrap–5 June 2020
- From pre-flight massages to COVID-19 testing: XpresSpa pivots to XpresCheck at JFK
- GermFalcon to take flight as Honeywell UV Cabin System
- Allegiant driving passenger traffic recovery
- Air travel is bouncing back: Can the trend hold??
- Masks Matter: US carriers plan more enforcement for on-board behavior
- JetBlue plans to outsource airport operations at (more) smaller destinations
- Norwegian set to restart European services from 1 July
- Jilted travelers get aggressive in seeking airline refund enforcement from the DOT
- LATAM Argentina, LEVEL Europe face bankruptcy
- Air Canada launches half-priced Aeroplan rewards in North America
- AirShield proposes curtains of air to separate passengers in flight
- Curing Catering Concerns: The Weekly Wrap–19 June 2020
- A big hint that British Airways will retire its 747s soon
- JetBlue’s crazy summer of new routes
- Air Canada fights back on refund demands, disputes DOT authority
- JetBlue pilots secure no furlough deal through April 2021
- Peek inside the largest converted cargo aircraft flying today
- ZIM Flugsitz seeks insolvency protection
- JetBlue launches trial for Honeywell’s UV Cabin System (f/k/a GermFalcon)
- ExpressJet to wind down operations on 30 September
- Spirit Airlines avoids pilot furloughs in October
- A stalled recovery: Airline traffic retreating
- United Airlines introduces at-airport COVID testing for SFO-Hawaii flights
- AirAsia Japan halts operations
- Cathay Dragon shuttered, 8,500 jobs eliminated
- Researchers link 59 Irish COVID cases to inbound long-haul flight
- A fleet of salvage-priced planes
- Global Eagle charts a new course out of Chapter 11
- United launches pre-flight COVID testing to London
- Allegiant ditches advertising, improves conversions
- Interjet lacks fuel, cancels flights for two days
- Canada plans aviation bailout, so long as passengers get refunds
- JetBlue to stop blocking seats in January
- JetBlue plans additional spending cuts, debt raises into 2021
- Norwegian abandons long-haul operations, refocuses on 737 routes in Europe
- Air Canada, Transat merger approved, with notable conditions attached
- Scammy COVID-safety "certifications" could put industry recovery at risk
- ATPCO adds testing, vaccine requirements to flight search results
- US DOT puts the squeeze on Hong Kong
- Air France secures €4 billion, (maybe) cedes Orly slots
- Air Canada refunds (finally) coming with government bail-out
- United adds Europe routes in hopes of a recovery
- Finnair adds A330 cargo conversion with Lufthansa Technik, Airbus
- Anti-microbial power outlets set to fly
- Aer Lingus delays Manchester-US service launch
- Air Canada fights back, disputes $25 million DOT fine
- Cathay Pacific giving away "Plane for a Day" in vaccination push
- JetBlue sees only 300 unvaccinated as deadline looms
- Ethiopian, Aero HygenX partner to deploy UV-C cabin disinfection
- Air Canada fined $2 million in DOT settlement
- JetBlue plans February schedule adjustments
- Northern Pacific visits Saipan in search of partners
- Eastern Airlines plans Shanghai flights
- LATAM fined $1 million for COVID refund delays
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