The nose of a Delta Air Lines Boeing 777-200ER dedicated to David C. Garrett Jr, former CEO of the airline is seen at the Narita airport.
Fabrizio Gandolfo | SOPA Images | Getty Images
Delta Air Lines said Thursday it aims to eliminate its daily cash burn by the end of the year and will retire its fleet of Boeing 777s, a sign it doesn’t expect a quick return of long-haul international travel as the coronavirus batters demand.
The Atlanta-based airline said it has halved its daily cash burn to $50 million a day on schedule, as it cut flights and reduced other expenses because of the pandemic.
“Our principal financial goal for 2020 is to reduce our cash burn to zero by the end of the year, which will mean, for the next two to three years, a smaller network, fleet and operation in response to substantially reduced customer demand,” CEO Ed Bastian said in a staff memo.
Demand for international flights has plunged because of the disease, travel restrictions and shelter-in-place orders, and airlines have slashed those routes.
“With international travel expected to return slowly, we’ve also made the difficult decision to permanently retire our Boeing 777 fleet — 18 aircraft — by the end of the year,” Bastian told staff. He said more “fuel-efficient and cost-effective” A330s and A350-900 planes, made by Airbus will be used instead. “Retiring a fleet as iconic as the 777 is not an easy decision — I know it has a direct impact on many of you who fly, crew and service these jets.”
Clarification: Summaries of this report have been revised to clarify that it was Delta that said it aims to reduce it’s cash burn to zero by the end of the year.