American Projects 17% 2Q RASM Decline
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By Adrian Schofield
American is expecting its mainline unit revenue to be down by 16%-17% in the second quarter, and although this is a large drop, analysts note it is not quite as steep as the declines projected by competitors United and Delta.
According to American’s latest update, consolidated unit revenue is estimated to be down 16.2%-17.2% for the quarter. The cash balance will be essentially unchanged versus the first quarter, with the airline expected to end the second quarter with $3.3 billion in cash and short-term investments.
This excludes about $50 million in hedge collateral posted with counterparties.
Meanwhile, American says its systemwide capacity cuts will mean a reduction of 17.8% at St. Louis – slightly higher than the overall average. In the first wave of cuts, 10 daily American Eagle or Connection flights will be eliminated in late August.
In November, eight mainline flights will be cut. This will leave American with 83 daily departures at St. Louis, including 34 mainline.
Photo: American Airlines
