AMERICAN AIRLINES PLANS TO BOOST JULY FLIGHTS BY 74%

The situation

American Airlines will boost July flights 74% from its current schedule as U.S. travelers freed from shelter-in-place orders rush back more quickly than expected.

The busiest days next month will have about 4,000 flights, up from 2,300 in June, said Vasu Raja, American’s senior vice president of network strategy. That’s equivalent to 40% of capacity a year earlier, compared with 30% in June, the airline said Thursday.

American also will begin reopening its loyalty club lounges in phases starting June 22, after making improvements to encourage social distancing and reduce the possible spread of COVID-19. The measures include plexiglass shields at desks and foot-operated door openers.

Why it’s happening

American’s expanded schedule builds on recent indications from rivals that customers are starting to make their way back onto planes after fleeing in April because of the coronavirus pandemic.

While traffic is still weak by historical standards, the airline’s trends suggest that the worst has passed. Load factor, or the average share of seats filled per plane, climbed to 55% last week from 15% in April.

How markets responded

The announcement caused airline stocks to reverse losses, with American jumping 6.4% to $12.61 in premarket trading in New York. The carrier had tumbled 59% this year through Wednesday.

How big picture looks

United Airlines and Delta Air Lines also are resuming some overseas flights, but lucrative international business traffic is expected to be the slowest area to rebound. Confusion over which countries have lifted travel restrictions and whether tourist attractions, hotels or other industries are open has contributed to the slower global recovery, Raja said.