(Updated: to reflect the effect of cumulative retirements)
At the time of this article the following are the current capacity reductions announced publicly by other carriers. These are changing rapidly almost hourly, and it is very difficult to keep up with the changes in the model.
Alaska – 3% Cuts in May
Out of the available announcements Alaska has outlined the most optimistic cuts at 3%, American and United at about 10-20% respectively and Delta 40%.
What is concerning (if Delta’s booking curve is similar to SouthWest), is that in a matter of roughly ten days Delta felt they had enough data to justify announcing grounding of over 300 of their aircraft in the coming weeks/months.
Simple Pilot Demand projections based upon a 40% drop and a 9/11 slow recovery model for the airlines look as follows and its not pretty. It takes the 9/11 change over time and applies it to a 40% cut vs a 29% cut seen in traffic after 9/11.
The truth is we really have no idea what the recovery will look like. Hopefully it will not be a slow recovery like we saw after 9/11, but in case it is the mandatory retirements will provide a much needed cushion. Furloughs are usually not practical or economical unless they are needed for longer duration. Usually a year to two years as has been seen in the past. Even in this worst case scenario most airlines will need pilots within the second year based on these simple models.