JetBlue Cuts Exec Pay, Reduces Capacity and Defers Jet Purchases

JetBlue’s plan during the coronavirus outbreak cuts executive pay, reduces capacity and defers jet purchases, among other efforts.
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JetBlue  (JBLU) - Get Report said its plan during the coronavirus outbreak cuts executive pay, reduces capacity and defers jet purchases, among other efforts. 

Chief Executive Robin Hayes and Chief Operating Officer Joanna Geraghty will take a 50% pay cut during the coronavirus pandemic, the company said in a Wednesday letter to staff.

The carrier said that on a typical day in March last year the company generated about $22 million from bookings and ancillary fees. This year, that total averages less than $4 million daily. 

The company is also issuing over $20 million a day of flight credits to customers for canceled bookings. 

JetBlue has already announced initial capacity reduction, pay cuts for execs, voluntary time off programs and other spending reductions, but now the company is reducing flights even further. 

It's reducing capacity at least 40% in April and May, and the airline expects substantial cuts in June and July. 

The company is cutting capital spending. 

And it is also reviewing its fleet plan with supplier Airbus to slow deliveries and reduce payments required before aircraft are delivered. 

To bulk up its cash reserves, JetBlue said it secured a $1 billion credit facility.

Finally, the company called for government intervention.

"When this pandemic passes – and it will – air travel will play a major role in getting life back to normal and supporting economic recovery," JetBlue said. "We are going to need significant government help to do that." 

Collectively, U.S. airlines are asking the government for more than $50 billion, including both direct aid and loan guarantees.

At last check JetBlue shares were trading off 7.1% at $8.84.