American Airlines (AA, Dallas/Fort Worth) may put up its AAdvantage loyalty scheme as collateral to nail a USD4.75 billion loan secured by the US government, to complement the USD5.8 billion it has already secured in aid to pay salaries.

American is currently discussing terms for the US Treasury loan, American Airlines Group president Robert Isom said at a conference on May 19, adding that the “impact value” of the loyalty programme could range between USD18 billion and USD30 billion.

Isom was speaking at a Wolfe Research virtual conference, at which executives at Air Canada, American, and Delta Air Lines all reported an improvement in bookings on some routes, Reuters reported. But demand remains weak - an environment where new business models may be forged.

American Airlines, which shoulders the biggest debt pile of North America's major carriers, will have to “right-size” to ensure positive cash flow next year, CFO Derek Kerr told the conference. American has invested heavily in renovating its fleet.

It is now conducting a six-month review of its future size and scope, which may include replacing its B777-200(ER)s with its forty-seven B787s on order. That would curtail future capacity but improve efficiency.

“Those 787s that are coming in - they can serve as potential growth or they can take out additional 777s over the long run as that fleet ages,” Isom told the conference, according to Forbes magazine.

American currently possesses forty-seven B777-200(ER)s, the ch-aviation fleets advanced module shows, which have an average age of 19.5 years, the oldest aircraft type in the carrier's varied fleet. Today, 38% of them are 20 years or older, increasing to 91% by 2022. Isom did not say how many of them could be retired.

“A lot of it is going to have to do with how the marketplace develops,” he said, acknowledging that such a move would reduce the carrier's widebody fleet.

The coronavirus crisis has forced American to mostly retire its A330 and B767 widebodies. Besides the B777-200(ER)s, it has fifteen A330-200, four A330-300, seventeen B767-300(ER), and twenty B777-300(ER) widebodies, according to ch-aviation data, as well as twenty-two each of the B787-8 and B787-9.

“From a widebody perspective, we’re down to 787s and 777s,” Isom said.

American decided in April 2018 to order twenty-two B787-8s and twenty-five B787-9s with the aim of replacing the A330s, B767s, and some of the older B777s.

“We don’t have any plans over the next three or four years to grow that widebody fleet any bigger than the 787s that are coming in,” Kerr concurred.