American Airlines suspending all China flights
Americans stranded in China
The United States yesterday issued a DO NOT TRAVEL warning for China. This morning it appears American Airlines is taking the lead suspending all flights from the United States to China, also stranding Americans in China.
The following is the unofficial transcript of BREAKING NEWS from CNBC’s Phil LeBeau on CNBC’s “Squawk on the Street” (M-F 9AM – 11AM) today, Friday, January 31st.
PHIL LEBEAU: Carl, we’re still waiting for an exact date when American will suspend all flights between the U.S. and Mainland China. I wouldn’t be surprised if it’s perhaps a week, maybe seven or eight days out. It’s a similar situation to Delta. Not only do you have to, you know, wind down those operations, but for the people who are in China, who are your customers, who want to get out, you have got to provide some way of doing that. So, we are waiting for the final announcement from American. I’ve been reaching out to United. We haven’t heard from them. But don’t be surprised, you know, look, once the State Department issued the Do Not Travel warning, you combine that with the fact that these planes maybe only 35% or 40% full, it makes no sense for the airlines to continue these flights. So, that is why we already saw Delta make this announcement this morning. Now you have American announcing that it is suspending operations between the U.S. and China. And I wouldn’t be surprised if we hear something from United fairly soon, as it is the only carrier right now that has not made a decision to completely stop flights between the U.S. and China. But again, we’re still waiting on that date from American.
DAVID FABER: It does, Phil, feel like we’re heading that way where there’s going to be no flights. it is funny because we had HHS Secretary Azar yesterday asking him repeatedly why the U.S. wouldn’t just shut it down. But I guess the carriers are making the decision for them.
PHIL LEBEAU: They are. And it is primarily economically driven. It’s not that they don’t care about the health concerns, etcetera. But at the end of the day you’re operating a business and if you only have 40% of your seats full or 30%, whatever it is, it makes no sense to continue those flights. What is interesting, David, is the question that I saw you ask the Head of Health and Human Services, ‘Well, what happens if one of these people then go to a third country? Let’s say somewhere in Europe. And then come from Europe over here.’ That’s why I think you’re going to see carriers around the world just shut it down. They will shut it down for a period of time and we just won’t see flights coming in or out of China or not on a large scale. We’ve already seen it with British Airways. And I think we’ll see it with other international carriers.
CARL QUINTANILLA: Phil, all that capacity, where is it going to go? And does it mean we might see a reduction in fares, Trans-Atlantic to other areas in Asia?
PHIL LEBEAU: No. I don’t think so. I don’t think so, Carl. It’s while there are what, 42 daily flights—let’s take Delta, 42 daily flights between the U.S. and China. Or weekly flights I should say. Between the U.S. and China for Delta. I mean, while that sounds like a lot, in the grand scheme of the whole fleet that Delta operates, it is a small, small percentage. It’s growing. It’s important. But it’s not as though it is going to be a case where, well, these planes are just going to be parked. They’re not doing anything. They’ll put those planes to use with other routes. So, is it a slight, slight bump, perhaps, to capacity for other routes here whether here in the U.S. or to Europe? Maybe. But nothing that is going to be major.
SARA EISEN: Phil LeBeau, thank you very much.