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An American Airlines Boeing 737-800 equipped with radar altimeters that could conflict with telecommunications 5G technology can be seen flying 500 feet above the ground as it approaches for landing at LaGuardia Airport in New York, New York, on January 6. , 2022.

The executives of the nation’s largest airlines learned a hard lesson this summer: it’s easier to make plans than to keep them.

The three largest U.S. airlines — Delta, United and American — are scaling back their flight growth ambitions in an effort to fly more reliably after biting off more than they could chew this year as they sought an unprecedented recovery in travel despite many logistical challenges. supply chain constraints as well as staff shortages.

The cuts come as airlines face rising costs, which they expect will continue to decline significantly, as well as a possible slowdown in economic growth and spending by the nation’s top business travelers.

Building buffers

United Airlines estimates it will restore 89% of 2019 capacity levels in the third quarter and about 90% in the fourth quarter. Read also : Top 3 Countries for Future Growth: United States, Norway, and United Kingdom. In 2023, it will increase its flight schedule by no more than 8% over 2019, compared to an earlier forecast of 20% more flights than in 2019, before the Covid-19 pandemic.

“Essentially, we’re going to continue to fly as much as we are now, which is less than we intended, but we’re not going to grow the airline until we see evidence that the whole system supports it,” United CEO Scott Kirby said in an interview with CNBC’s “Fast Money” after the results were released Wednesday . “We’re just building more buffer into the system so we have more capacity to accommodate these customers.”

American Airlines CEO Robert Isom also spoke of a “buffer” after reporting record earnings on Thursday. The carrier has been more aggressive than Delta and United in restoring capacity, but said it was flying between 90% and 92% of its 2019 capacity in the third quarter.

“We continue to invest in our operations to ensure we meet our reliability goals and benefit our customers,” Isom wrote in a staff memo, discussing the airline’s performance. “Looking ahead to the rest of the year, we have taken proactive steps to add additional buffer to our schedule and will continue to limit capacity to available resources and operating conditions.”

Delta, for its part, apologized to customers for the flight cancellations and disruptions and said last week that it would limit growth this year. He previously announced he was cutting back his summer schedule.

On Wednesday, Delta credited 10,000 miles to the accounts of SkyMiles members whose flights were canceled or delayed more than three hours between May 1 and the first week of July.

“While we can’t make up for lost time or anxiety, we’ll automatically deposit 10,000 miles into your SkyMiles account to help you do better in the future and restore the Delta difference you know we’re capable of,” the email to customers said. , a copy of which was seen by CNBC.

By cutting schedules, airlines could keep fares high, which is an important factor for their bottom line as costs remain high, but it’s bad news for passengers.

“The more airlines restrict capacity, the higher the airfare they can charge,” said Henry Harteveldt, founder of the Atmosphere Research Group and a former airline executive.

With the economic uncertainty ahead, maintaining the bottom line is key.

“They won’t get any new help,” Harteveldt said. “They’ve wasted a lot of their goodwill.”

More disruptions, higher revenue

Since May 27, the Friday Memorial Day weekend, 2.2% of flights on US carriers have been canceled and nearly 22% have been delayed, according to flight tracker FlightAware. This is more than the 1. Read also : Secretary Blinken’s Meeting with First Lady of Ukraine Zelenska – US State Department.9% of canceled flights and 18.2% of delayed flights during the same period in 2019.

The labor shortage has exacerbated routine problems airlines already faced, such as spring and summer thunderstorms, stranding thousands of passengers as carriers lacked a cushion of backup workers.

Airlines received $54 billion in federal payrolls that banned layoffs, but many have laid off pilots and called for employee buyouts to cut costs during the pandemic.

Airport staff shortages in major European hubs have also led to flight cancellations and capacity constraints. Officials at London’s Heathrow told airlines last week that they needed to limit the number of departing passengers, forcing some airlines to cancel flights.

“We told Heathrow how many passengers we had. Heathrow basically told us, ‘You’re smoking something,'” United CEO Kirby said Wednesday. “They didn’t staff it.”

A representative for Heathrow did not immediately comment.

Still, the big three U.S. airlines posted profits in the second quarter and were bullish on passenger demand throughout the summer.

For American and United, it was the first positive quarter since Covid without federal wage subsidies. Revenues for both airlines rose above 2019 levels.

Every airline forecast third-quarter profits as consumers continue to fill seats with fares well above 2019 prices.

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