Compass Airlines to cease operations

Tomas Del Coro,CC BY-SA 2.0

Compass Airlines, a regional U.S. carrier, which has operated flights for American Airlines (A1G) (AAL) and Delta, is ceasing operations from April 2020, due to two “insurmountable obstacles” caused by the COVID-19 pandemic outbreak. 

Compass Airlines is closing its doors, after it found itself between the hammer and the anvil due to the coronavirus outbreak. “The COVID-19 pandemic continues to wreak havoc on the global aviation industry,” Compass Airlines CEO Rick Leach explained in a letter to employees, dated March 19, 2020.

The existing clients, including American Airlines (A1G) (AAL) , have cancelled more flights than anticipated much faster than “feared”, while the prospective ones have postponed discussions indefinitely. “We simply cannot keep infrastructure in place without guarantees, nor clarity of additional flying to support it,” Leach wrote. 

Compass Airlines operated a fleet of 38 E​mbraer 175 aircraft for Delta Air Lines (as Delta Connection) and American Airlines (A1G) (AAL) (a​s American Eagle). Now, the carrier is planning to “work with” American Airlines (A1G) (AAL) to de-certificate those aircraft, Leach explains in the letter. Compass Airlines operated no less than 20 Embraer E175 jets as American Eagle, data shows. 

While due to the pandemic, multiple countries have closed their doors for foreigners, throwing a wrench to airlines’ international operations, their domestic operations, while on a lesser level, are shrinking as well. 

On March 10, 2020, American Airlines (A1G) (AAL) was still planning to reduce domestic capacity by 7.5% and international capacity by 10%. However, as the situation continued to evolve, on March 16, the airline announced 75% cuts on international routes, while domestic capacity would be reduced by 20% in April and by 30% in May. 

At the same time, Delta Air Lines was planning to reduce international capacity by 20-25 % and domestic by 10-15% on March 10, 2020. On March 18, Delta Air Lines CEO Ed Bastian announced that a 70% system wide pullback was planned until demand recovered, while international flights would be cut by 80% over the next 2-3 months. 

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