Airlines terminate over 700 flights in the U.S. as FAA-mandated shutdown reductions commence

U.S. airlines initiated cancellations of numerous flights on Friday, shortly after the Federal Aviation Administration mandated reductions amidst the ongoing government shutdown that has lasted over a month.

The cuts were implemented as air traffic controllers faced missed paychecks resulting from the government shutdown, which is now the longest in U.S. history. Staffing shortages among air traffic controllers have led to flight disruptions at several major U.S. airports, causing frustration for both travelers and airline executives.

Shortages of air traffic controllers were causing flight delays at several major U.S. airports on Friday, including Newark Liberty International Airport in New Jersey, San Francisco International Airport, and Hartsfield-Jackson International Airport in Atlanta.

The abrupt flight cancellations this week compelled airlines to rush into schedule modifications and ensure crews are in the right locations despite the sudden changes.

Approximately 780 U.S. flights were canceled by 2 p.m. ET Friday, as reported by aviation data provider Cirium, accounting for about 3% of the day’s total schedule. This level of disruption is not unusual for standard incidents like major thunderstorms, yet the Department of Transportation cautioned that cancellations could increase.

Per the FAA’s directive, flight cancellations will rise to 10% over the coming week, starting with 4% on Friday, increasing to 6% by Tuesday, 8% by Thursday, and reaching 10% by November 14.

On Friday, cancellation levels ranked as the 72nd worst for the U.S. flight market since January 1, 2024, according to Cirium. That timeframe also included a Southwest Airlines’ holiday disaster triggered by severe weather and significant delays at Delta Air Lines last summer following a CrowdStrike technical failure.

While the FAA mandated flight reductions, the general aviation sector, which encompasses private jets, was not subjected to similar extensive cuts. The directive mentioned that staffing shortages might affect general aviation, with private flights potentially facing up to 10% cuts at airports identified by the agency as “high-impact,” such as New Jersey’s Teterboro Airport and Texas’ William P. Hobby Airport in Houston and Dallas Love Field.

The FAA did not respond to requests for a statement.

A representative for the National Business Aviation Association acknowledged that the industry is also impacted by air traffic staff shortages and reduced capacity, noting that airports could restrict landing permissions for certain airplanes.

Ed Bolen, president and CEO of NBAA, stated that “our sector will persist in pursuing mandatory and voluntary measures to ensure we are part of the solution to the challenges posed in the present environment.”

The economic consequences of the recent disruptions are not immediately evident. The cancellations could potentially boost airlines’ unit revenue as travelers compete for limited seats, “but we also believe the extended shutdown and widespread cancellations will influence booking demand in the short term,” commented Scott Group, an airline analyst at Wolfe Research, in a report on Friday.

The reductions arrive during a typically low-demand travel period leading up to the Thanksgiving holiday, but they have sparked many travelers to seek alternatives. Rental car company Hertz reported a more than 20% surge in one-way rental bookings over the past two days compared to the same period last year.

Major network airlines noted that the disruptions predominantly affected regional flights servicing smaller cities. For instance, United Airlines indicated that its hub-to-hub flights and long-haul international routes would not be subject to cancellation due to the directive.

American Airlines reported that it was minimizing disruptions for customers by refraining from cutting routes it operates only once or twice daily. Instead, the airline is reducing a handful of flights daily from high-frequency markets – such as decreasing daily departures from its hub at Dallas Fort Worth International Airport to Northwest Arkansas National Airport from 10 to eight, and Boston Logan International to Ronald Reagan Washington National from 10 to nine.

The carrier canceled 221 flights on Friday, according to CEO Robert Isom, who expressed that the airline feels “frustrated” with the reductions.

Isom mentioned on CNBC’s “Squawk Box” that the airline is striving to guarantee that flights to all destinations continue to operate, although the frequency of those service routes is being reduced.

“What we’ve accomplished today is we’ve worked to limit the effects on all our customers — just 220 flights out of 6,200 flights, and we’ve managed this in a way that primarily impacts our smaller aircraft,” Isom said. “This level of cancellation is anticipated to grow over time, which will pose challenges.”

Airlines provided travelers with alternative flight options and waived change fees for those affected.

Experts advise keeping up with schedule changes by checking airline apps and websites, as well as understanding the details of travel insurance policies.

AAA representative Aixa Diaz recommended arriving at the airport two hours in advance to avoid long waits and suggested avoiding checked bags if possible in case flights get canceled, emphasizing that flexibility is crucial for all travelers during this time.

Travel insurance experts caution that policies may not universally cover shutdown-related changes, and refunds often hinge on the specific reasons cited by airlines for delays or cancellations.

According to Lauren McCormick, a spokesperson for travel insurance platform Squaremouth, airlines may sometimes not specify reasons beyond general delays even during a shutdown, which could complicate obtaining refunds. Some credit cards offer trip insurance, though it is not guaranteed.

Here’s where flights are projected to be reduced, according to the FAA and DOT directive:

(The airport in Las Vegas was renamed the Harry Reid International Airport in 2021.)

— CNBC’s Greg Iacurci contributed to this report.