The story of the summer so far has been American’s aggressive approach to capacity in the domestic US market. The airline put out far more than United and Delta, and throughout June, it benefited greatly as leisure travelers started to make plans and buy tickets. But now, things are changing in several ways. August schedules are loaded, and others are playing catch up… just in time for a booking slowdown.
American and United both loaded their domestic August schedules over the weekend. For United, this was a big deal… big enough for the airline to put out a press release touting 25,000 new flights in August compared to July. This is growth, but let’s put this in perspective.
Using Diio by Cirium schedule data, I took a look at one week in each month from April through August and compared that to schedules from a similar week the previous year. Here’s a look at what percent of flights are being operated year-over-year.
Keep in mind that in April, airlines canceled a whole lot of flights closer to departure, so they were scheduled but not flown. In other words, that number should be lower. But what we see here is that Southwest has remained above the rest, as you might expect. American has been perched above the rest as well, but it began to expand the gap versus Delta and United in June with it peaking in July.
Once the other airlines saw American’s success at filling airplanes, they decided to join the party. You can see that Delta is just about where American is for August with United still trailing. At the same time, American has gone flat in August versus July.
This is interesting, but it’s also a lie. We have to take into account the load factor caps that only some airlines are implementing. To do that, I had to look at seats year-over-year, not flights. Then I reduced 2020 numbers for Southwest to 65 percent, Delta to 60 percent, and American to 85 percent only through June. These aren’t perfect by any stretch. Delta varies percentage by cabin, and American had a cap on the number of bookings it would take but not a hard cap on load factor. [Update: American tells me it was a hard cap, so the number is more accurate than I thought.] Still, this tells us a great deal.
This looks a lot different, doesn’t it? With load factor caps, Delta and Southwest fall down the chart. Now it’s American that looks most aggressive, especially in July and August where it removed any internal shackles that it once had.
United has closed the gap, but Delta is just so far below everyone else, it’s remarkable how much lower they are.
In August, Delta is effectively working to rebuild a viable network for the first time in months. Take a look at this chart showing the net number of routes added.
Southwest has pushed ahead with adding a great number of routes — 85, to be exact — while cutting 15. But Delta is not far behind, and United has added a large number as well.
Looking at Delta’s schedule, it’s distributed among the hubs pretty evenly. Minneapolis/St Paul is the big winner with 11 new routes while Salt Lake City is runner up with 9. Los Angeles gets 8, Atlanta and Detroit both see 7, Cincinnati gains 5, Boston adds 3, and Seattle gets 2. This is Delta building back up to overflying other hubs as demand picks up. That’s good from a route network perspective, but there are still very few seats being offered.
For United, it’s a different story, as the airline mentioned. It is focusing on building up its central US hubs and focusing on places where there is less virus and more outdoor activity. Because of that, Denver gets 19 new routes while Houston gets 6 and Chicago 5. Newark continues to rebound from nothing with 7 new routes. Los Angeles surprisingly gets 8, but half of those are simply Hawai’i routes coming back as the quarantine gets lifted. San Francisco has only 3 new routes, one of which is to Hawai’i.
I left Alaska and Hawaiian on this list, because they’re notable. Alaska is basically saying, “Hey, that schedule we were going to operate in July but canceled recently? Well, we’re gonna just try that in August.” And Hawaiian, of course, is just coming back from nearly nothing since the quarantine has been lifted.
American, however, remains at the back of the pack with very little change at all. Four of its additions are to Hawai’i. The rest are Charlotte to Williamsport (PA), Phoenix to Memphis, and Philadelphia to both Islip and Stewart in New York. All of those operate once or twice a week.
Does this mean that American knows something? Maybe it rightly bet on demand growing early, but then it saw that demand had plateaued and has frozen its schedule for the summer. Or maybe it’s worse than that and things are backsliding. This would certainly fit with the new round of coronavirus cases that are primarily impacting states in the south and southwest. If you take away big vacation destinations like California and Florida as viable spots to visit, there may be big problems on the horizon.
