ATLANTA — Atlanta-based Delta Air Lines announced revenue fell by $2 billion in March due to the spread of COVID-19 and a drop in demand for air travel, according to an internal memo filed with the Securities Exchange Commission.
In the letter, Delta CEO Ed Bastian says the impact of the new coronavirus continues to grow and Delta will "make significant capacity reductions with a 70 percent system-wide pullback planned until demand starts to recover.” International operations will take a bigger cut, with 80 percent of flying reduced over our next two to three months.
Delta is also taking other cost-cutting measures including:
- Deferring all new aircraft deliveries
- Delta officers will take a 50 percent pay cut through June 30; and directors and managing directors will take a 25 percent cut during the same time period
- Bastian has cut his salary by 100 percent over the next six months and the board of directors will forego their compensation
- Delta will temporarily consolidating facilities in Atlanta and close a majority of Delta Sky Clubs
- More than half the fleet, about 600 aircraft, will be parked. Older aircraft will have an accelerated retirement.
The memo says that 10,000 employees have volunteered to take leave. Employees continue to have access to health and flight benefits while on leave.
“Make no mistake – we will get through this. This is a temporary health crisis and an end will, hopefully soon, be in sight. Never underestimate the power of travel as an essential service to our world," Bastian wrote. "All of our work over the past decade to fortify our company and transform our business model will serve us well in the weeks and months ahead, as we endure and, eventually, recover.”
© 2020 Cox Media Group