Following United Airlines, another major U.S. carrier plans additional furloughs. Delta Airlines (DAL)’ reportedly plans for 2,000 pilots to leave jobs in October 2020, after the $32 billion payroll aid to the industry by the U.S. government expires.
The extensive changes to the employee structure are reportedly due to the slow aviation industry recovery after the COVID-19 crisis. Previously, 1,806 Delta’s pilots already took early retirement, but the company now says this was not enough to offset the situation.
“The voluntary measures currently on the table just don’t move the needle enough. It’s with this reality that we, unfortunately, will move forward to furlough 1,941 pilots in October,” senior vice president of flight operations John Laughter allegedly wrote in an internal memo received by the New York Times.
The U.S. Coronavirus Aid, Relief, and Economic Security Act (CARES) was established by the U.S. government as a payroll aid for employees to keep their jobs. As the deadline for CARES approaches its expiration date on October 1, 2020, some airlines have begun announcing plans for mass layoffs.
There were talks of a $25 billion aid package for the U.S. airlines after a group of Republican senators backed the payroll assistance program’s extension on August 6, 2020. However, that deal remains at a standstill.
United Airlines said on July 30, 2020, that it would need to furlough up to a third ‒ 3,900 ‒ of its pilots if the pandemic continued to suppress travel demand. The company did not specify a timeframe for the planned layoffs, but merely extended the application deadline for its existing voluntary leave programs.
Both Delta and United reported massive financial losses of $5.7 billion and $1.6 billion, respectively, in Q2 2020. The airlines do not expect air traffic to begin recovery at least until a COVID-19 vaccine is widely available, which they estimate to be around the end of 2021.
