U.S. airlines are considering jointly consolidating services
during the Covid-19 crisis, according to a CNBC report. 

Under the $58 billion airline stimulus package that became
law on Friday, carriers that accept grants or federally guaranteed loans must
continue flying to each destination that they serve unless they receive Transportation
Department permission to do otherwise.

Consolidating operations to smaller markets could serve as a
workaround to that requirement. 

“Does it make sense for more than one of us to be flying to
a city when there are only a few seats filled on each plane,” CNBC quoted one
anonymous airline executive as saying. “It may make more sense to maintain
service to that city but to put all passengers on one plane.”

CNBC added that it spoke with executives of “multiple
airlines” about the concept, though those executives said the idea had not yet
been formally presented to the Transportation Department. 

The department didn’t offer a specific view on the concept
in a statement Monday. 

“This is an important issue and the department supports the
intent of maintaining a national network of air service to communities across
the country,” a DOT spokesperson said. 
We will have further guidance about how this will be accomplished in the
days to come.”

U.S. airlines have dramatically pared back schedules but are
nevertheless flying nearly empty planes. In a letter to employees Friday,
United CEO Oscar Munoz and president Scott Kirby said they expect April load
factor fall into the teens or even single digits, even with a capacity cut of
more than 60%. 

On March 29, the Transportation Security Administration
screened 180,000 passengers and crew members, compared with 2.5 million on the
same date last year. ARC reported an 88.5% year-over-year drop in the number of
tickets issued for the week ending March 29. 

According CNBC, if airlines were to jointly consolidate
service, they would continue to separately sell tickets for city pairs on which
they now compete. However, instead of three carriers flying New York
LaGuardia-St. Louis, for example, every passenger would be funneled onto a
single flight. Such an arrangement would require the completion of complicated
commercial agreements. 

The trade group Airlines for America declined to comment on
the topic Monday. United, Delta, Southwest and American either didn’t respond
to a request for comment or declined to comment. 

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