Hawaiian Airlines is reducing systemwide capacity by up to 10 percent in April and as much as 20 percent in May as COVID-19 continues to overwhelm the travel industry.
The decision comes as Lufthansa suspended its dividend for the 2019 financial year and warned its flight schedule over the next few weeks could be 70 percent lower than originally planned.
Hawaiian, which is exposed to the hard-hit Asia-pacific market, said the reductions of 8 to 10 percent in April and 15 to 20 percent in May would match current demand.
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Schedule changes were due to be introduced this week.
“We find ourselves in a rapidly evolving environment that has presented our company with its greatest challenge in many years,” Hawaiian Airlines chief executive Peter Ingram said in a letter to employees.
“We know this will not be our new normal, but we can’t know when health experts and community mitigation efforts will bring the spread of the virus under control – or when travel apprehension will fade.”
The situation with change waivers is volatile as countries such as the US and New Zealand introduce travel restrictions and airlines struggle to keep pace.
According to its website late Saturday US time, Hawaiian is offering general travel change fee waiver for guests who book between March 1 and March 31 to allow them to change their flight to a future date.
For bookings made through March 9, there is a travel waiver for travel between March 1 to April 30,
There is also a one-time change waiver for travel to New Zealand for tickets booked before March 31 for travel to December 31 as well as a one-time travel waiver for Europe.
The airline said it would continue to offer passengers booking flexibility as it balanced its network to reflect evolving market conditions.
It was also expanding sanitation efforts across the company with enhanced cleaning of airport spaces and aircraft and had made in-flight service adjustments such as suspending the refiling of beverage and hot towel service.
Hawaiian is introducing a hiring freeze, reviewing third-party contracts, deferring non-essential aircraft painting, and renegotiating vendor rates as it grapples with the crisis.
Senior executives and board members are voluntarily taking pay cuts of 10 to 20 percent, effective immediately through at least June.
Earlier this month, Hawaiian announced it was temporarily suspending flights that operate three-times-weekly between Kona International Airport on the Island of Hawaii and Tokyo’s Haneda Airport, and four-times-weekly between Honolulu’s Daniel K. Inouye International Airport (HNL) and Haneda.
It also suspended its five-times-weekly nonstop service between Honolulu and Incheon International Airport from March 2 through April 20.
Over in Europe, The Lufthansa Group announced that it was expanding rebooking options after customers called for more flexibility “given the current exceptional circumstances”.
The change means customers who have tickets for canceled and existing Lufthansa Group flights can now keep their tickets without having to commit to a new flight date directly.
“Existing bookings will be canceled for the time being, but the ticket and ticket value will remain unchanged and can be rebooked to a new departure date up to and including 31 December 2020,’’ Lufthansa said.
“This rule applies to tickets booked up to and including 12 March 2020 and having a confirmed travel date up to and including 30 April 2020.”
The airline said customers should inform them of their new booking by June 1.
The European Group said new bookings in recent weeks were about 50 percent lower and its flight schedule over coming weeks could be reduced further by up to 70 percent compared to its original plan.
It said it expected 2020 earnings to be significantly below the previous year despite moves to reduce costs, including employee working hours, and postponing planned investments.
The decision to suspend the dividend reflected its focus on preserving liquidity and the company revealed it had moved to secured its “strong financial position” by raising an additional 600 million euros in funds.
“The Group is currently in the process of raising additional funds,’’ it said.
“Among other things, the Group will use aircraft financing for this purpose. Lufthansa Group owns 86 percent of its fleet. Almost 90 percent of the owned fleet is unencumbered. This corresponds to a book value of around EUR 10 billion.”
Luftahnsa will report in detail on its business and outlook on March 19.
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