American Airlines Group (NASDAQ:AAL) is recalling all furloughed pilots and plans to resume hiring this fall, a clear sign that the carrier believes the worst of the pandemic-related travel slowdown is behind it.
In a bulletin to employees, American said it hopes to hire 300 new pilots by year's end, and to double that total in 2022. The airline hopes to fill some of those positions by reaching out to pilots whom they had intended to hire last year prior to the pandemic.
"This positive news for our pilots and our airline represents a change in course," the airline said in the bulletin. "The return to flying of so many of our pilots and the addition of hundreds more, the resumption of many old routes and the introduction of new destinations are hopeful signs, opportunities to look beyond the immediate and into a brighter future."
American and other airline stocks plummeted in the early days of the pandemic, but a combination of government assistance and private fundraising allowed the industry to remain airborne through the crisis. As vaccine numbers increase, travelers are slowly returning, and American has been among the most-aggressive airlines in restoring flights.
The move is not without risks. While traveler numbers are increasing, it is largely lower-fare leisure passengers and not the business and international fares who tend to drive profitability in good times.
So far this earnings season, airlines have warned they do not expect to have much pricing power heading into the summer. Adding capacity in a price-sensitive environment runs the risk of putting pressure on margins.