United Airlines is offering pilots to take a month off at reduced pay, according to a union memo sent on Friday, a measure that follows flight cuts due to the spread of coronavirus.
United on Friday announced service reductions throughout Asia because of the illness, known as COVID-19, which has sickened more than 83,000 people. U.S. airlines had already suspended flights to mainland China and Hong Kong. The spread of the illness has raised concerns that weak demand and new travel restrictions will prompt airlines to further cut international flights.
Chicago-based United has more service to Asia than any other U.S. airline. United earlier this week pulled its full-year guidance because of the outbreak. The carrier said demand to China collapsed entirely and fell by 75% in the rest of the airline's trans-Pacific routes because of the virus. United also on Friday announced it would postpone its investor day, which was scheduled for next Thursday because it "does not believe it is practical to expect that it can have a productive conversation focused on its long-term strategy next week."
United is now offering some widebody pilots a month off in April at the pay rate for 50 hours a month, lower than the roughly 80 hours pilots normally work, wrote Todd Insler, a United captain and chairman of the United branch of the Air Line Pilots Association, in a note to union members.
"The reductions in block hours has resulted in lower line values and fewer flying opportunities in some fleets," Insler said in the note. "We are preparing for the possibility of further reductions to our schedules as the virus spreads."
Because United reduced its flying in Asia it has "worked with our union partners to offer pilots associated with those changes the opportunity to voluntarily adjust their near-term schedules, as we do whenever business needs allow," a United spokeswoman said. "Moving forward, we will continue to evaluate the impact of COVID-19 and work closely with our labor partners to help manage our business to minimize the operational and financial disruption of the outbreak."
The virus is threatening to end a boom in air travel that helped propel U.S. airlines to a decade of profitability. Airline stocks fell more sharply than the broader market as corporations pulled back on business travel raising concerns about a broader slowdown in demand.
United's pilots, like those at American and Delta, are in the middle of contract negotiations with the company. Delta earlier this week slashed the number of flights it offers to South Korea, where the largest number of coronavirus cases outside of China has been reported, to 15 a week from 28.
"As of now, there has been no impact on our negotiating strategy or timeline," Insler told pilots in his note. "During negotiations both sides always keep economic cycles and external events in mind. Our goal remains ensuring we have a robust contract that protects our pilots throughout their careers in all economic cycles."