WASHINGTON (dpa-AFX) - Alaska Airlines said that it plans to reduce its flight schedule by about 70% in April and May citing drop in demand related to the COVID-19 outbreak across the U.S. and beyond.
Flight schedules for June and beyond will be based on demand, but it expects that reductions will be substantial for at least the next several months, the Airline said in a statement.
Alaska - like other airlines - is seeing demand reductions of more than 80%.
Alaska CEO Brad Tilden said, 'But we also know that given the lack of demand for air travel and profound impact on the financial management of our business, hard work and aggressive control of costs and cash are required, even with additional support.'
The Airline has suspended cash dividend and it has previously suspended share repurchase program. It has drawn down $400 million on its line of credit and closed an additional secured loan for $425 million today.
The Airline announced officer pay reductions through September 30, including 100% pay reduction for both the chief executive officer and president of Alaska Airlines.
Alaska Airlines's board has voted to take their own cash retainers to zero through September 30.
The Airline is actively soliciting employees who are interested in voluntary leaves of absence, under which Alaska would continue to pay both health and travel benefits. It has suspended annual pay increases, plan to reduce hours for management employees, and will release contractors and temporary workers.
The Airline noted that it is working with all vendor partners to reduce spending in line with its reduced flight schedule.
Copyright RTT News/dpa-AFX
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