Now that the CARE act has been written into law, the approach for the next 6 months has become more clear for the airlines. For the airlines that choose to access assistance offered by this act, they will not be permitted to layoff or furlough through Sept, significantly affecting the model. Critical infrastructure necessary for the transport of goods and services is incentivized and airline personnel are retained to allow for a quicker economic recovery when the economy begins to restart.

In six months the industry and the world will be in a much better position to determine the long term effects of this virus.

For those that have been following previous models and projections a number of things have changed in this updated hybrid model.

  • The hybrid model (9/11 recovery model combined with the SARS V recovery) has been adjusted to account for planned industry reductions in flying in the U.S. It is expected that May will be more reduced than April.
  • A 3 month moving average has been applied beyond June to smooth out monthly fluctuations associated with the hybrid model.
  • A four month lead time line has been applied to represent the lead time needed to staff and train pilots. Depending on the carrier and the complexity of their fleet types they may differ. This model assumes that pilots need to be “on property” about 4 months ahead of when they will need to be at peak productivity.
  • A non-retired pilots line. This line is current staffing based upon an estimate of current monthly mandatory(Age 65) retirements. As this number gets closer to the “four month lead time” line, the gap in excess pilots becomes smaller. The farther apart those two lines the greater the excess pilots.
  • A W/ALV min line. Which means the non-retired pilots’ line (available pilots) compensated for flying at average contractual minimum line values. Some carriers may allow average lines as low as 72 hours a month +-7 hours (Delta) and most carriers have this flexibility. Typical staffing and flying levels usually keep these “averages” 8-9% higher than minimums. This provides some flexibility if an airline chooses to retain pilots while flying at lower monthly minimums.
Composite of Legacy carrier Pilot Demand

If the airline industry recovers similar to how RPK’s recovered after 9/11 the industry could be in the ballpark (without a need to furlough) by the end of the year, but with reduced but currently contractually legal line values. Otherwise it could be closer to 2021 when demand for pilots exceeds current staffing values.

It’s important to note that carriers that are able to offer early retirements will effectively close the gap between current staffing and needed staffing sooner than carriers that don’t.

The following is the gap between current pilots minus retirements based upon the above chart.

Pilot Demand Gap (Based on W/min ALV and 4 month lead)


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