Alaska Airlines slashes flights by 70%, cuts costs due to coronavirus outbreak
Alaska Air Group Inc. (ALK) said late Wednesday it would cut its flight schedule by about 70% in April and May as it deals with a sharp drop in passengers amid the coronavirus pandemic. In a statement, Alaska said it has seen bookings drop more than 80%, and said flight reductions will be "substantial" for at least the next several months. The airline also said it is suspending its cash dividend, has drawn $400 million on a line of credit and secured an additional loan for $425 million. As part of cost-cutting moves, executives will take pay cuts -- including a 100% reduction for CEO Bradley Tilden -- annual pay raises for employees will be suspended and the company will solicit voluntary leaves of absences from workers. "These actions are unprecedented, but these are truly unprecedented times," Tilden said in the statement. "We are ultimately optimistic about the future of our great airline. But it is clear that we are and will be under severe financial pressure for the foreseeable future and that is why these actions are essential." Alaska Air shares rose Wednesday, but are down 56% year to date, compared to the S&P 500's 23% loss for the year.
-Mike Murphy; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
March 25, 2020 21:27 ET (01:27 GMT)
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