American Airlines To Cancel Milan Flights On Coronavirus Woes

American Airlines Group Inc. (NASDAQ:AAL) will suspend all U.S. flights to Milan due to a drop in demand as Italy becomes the hotspot of coronavirus outbreak in Europe. Italy alone reported more than 1,100 coronavirus cases and a death toll of 29. The virus broke out for the first time at a place situated about 40 miles from Milan.

American Airlines will be suspending Milan flights from New York (JFK) and Miami through April 24. The announcement came within a few hours after the U.S. State Department raised its travel advisory alert to "Level 4 - Do Not Travel" to Lombardy and Veneto in Italy "due to the level of community transmission of the virus and imposition of local quarantine procedures."

However, the carrier will continue to operate its daily flights between Philadelphia and Rome. It is expected to resume seasonal service to Venice in May.

Change Fee Waiver to Tackle Slackening Air Travel Demand

Amid decreasing air travel demand as the coronavirus outbreak spreads, American Airlines suspended change and cancellation fees for new ticket purchases through March 16. Customers can avail of this benefit up to 14 days prior to travel for scheduled journey through late January 2021.

JetBlue Airways (NASDAQ:JBLU) first started offering this facility last week to ease some of the travel woes associated with the coronavirus outbreak. Effective Feb 27, passengers can avail of the privileges on bookings through Mar 11 for travel to be completed by Jun 1, 2020.

Later Alaska Airlines, the subsidiary of Alaska Air Group (NYSE:ALK) , joined in. With the carrier’s "peace of mind'' waiver, passengers can avail of the benefits for tickets booked through March 12 on travel to be completed by Jun 1. Upon cancellation, travelers will earn a credit for a future flight. Fare differences will be applicable to the new ticket.

Given that the airline industry is grappling with low travel demand in the face of the coronavirus outbreak, other airline players may soon follow in the footsteps of American Airlines, JetBlue and Alaska Airlines. In this regard, Southwest Airlines (NYSE:LUV) is already in an advantageous position as it does not charge change or cancellation fees.

Zacks Rank

American Airlines carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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