The recovery of the airline industry has been based on the recent rise in COVID-19 cases, which caused U.S. travelers to cancel their Labor Day weekend travel plans.
Air travel approached pre-pandemic levels in July, which gave momentum and optimism to airlines for a robust fall season. but flight bookings fell in August amid high infection rates driven by the highly contagious delta variant.
The Transportation Security Administration (TSA) on Tuesday examined less than 1.4 million passengers, the total for one day lower since early May and a 34% decrease from the same day in 2019.
Flight bookings for Labor Day weekend fell 15 percent from pre-pandemic levels in late August, according to Adobe Digital Insights.
Tori Emerson Barnes, executive vice president of public affairs and policy for the U.S. Travel Association, said the organization is overseeing forecasts showing that Labor Day general travel decreases by 10% compared to 2019.
“The percentage of U.S. travelers with travel plans over the next six months remains strong at 88%, although more than 3 in ten U.S. travelers report that the delta variant is having a negative impact on their travel plans.The sentiment of domestic business travel has also declined considerably in recent weeks, “Barnes said. “The U.S. economy will not fully recover until travel recovers, and that includes the return of the major business and international travel sectors.”
The United States reported more than 4.2 million cases of COVID-19 in August, making it the fourth worst month for new infections, and virus deaths nearly tripled from July to August.
Director of the Centers for Disease Control (CDC) Rochelle Walensky
The spread of the Rochelle Walensky variant hinders Labor Day air travel and industry recovery CDC studies: higher childhood COVID-19 infections in low-vaccination states More than 20 percent of weekly COVID-19 cases at the end of August they were children: report MORE on Tuesday he advised unvaccinated Americans not to travel on Labor Day weekend and warned that vaccinated travelers should also weigh the risk of contracting the delta variant.
Major airlines have already softened their bullish predictions to take into account fears of delta variants.
American Airlines said last week that its August revenue will be lower than expected due to weak flight bookings and increased customer cancellations, driven by the increase in COVID-19 cases.
“This has been and hopefully continues to be a very turbulent recovery,” Vasu Raja, general manager of revenue for American Airlines, said during an August 25 investor conference.
Last month, Southwest Airlines CEO Gary Kelly said the company no longer expects to be profitable in the third quarter after raising revenue in June and July. Southwest significantly reduced its fall flight schedule, eliminating 27 daily flights from Sept. 7 to Oct. 6.
Strong leisure travel for much of the summer boosted airline profits, but many in the industry looked forward to the fall season in hopes that business travel would return in full force.
These expectations may not be met. While the U.S. corporate observed a return to face-to-face events and meetings in September, many major companies have delayed their reopening plans due to the delta variant.
An August 31 survey of Morning Consult and the American Hotel and Lodging Association found that 52% of business travelers are likely to cancel their existing travel plans and have no intention of rescheduling them. About two-thirds of respondents said they would take fewer business trips.
Even after the pandemic ends, 84 percent of large companies in the U.S., Asia and Europe plan to spend less on travel, according to a Bloomberg survey published this week.
International travel, another major source of revenue for airlines, has also been crushed by the pandemic. It remains 55% below 2019 levels, according to the Airlines for America industry trade group.
The Biden administration has refused to lift restrictions on international travel despite tremendous pressure from the tourism and travel industry. The administration previously announced a roadmap to lift restrictions, but has not done so with global cases of COVID-19 on the rise.
Meanwhile, the European Union has recommended this week that member countries issue travel restrictions for unvaccinated Americans. More than a quarter of U.S. adults have not been vaccinated against COVID-19.
The airlines had hoped that at this point, international restrictions would be lifted, not tightened.
Some airlines were profitable in the second quarter of the year, but they would have reported large losses had it not been for billions of dollars in federal aid. Congress has distributed $ 54 billion in pandemic assistance to help airlines keep employees on the payroll. This federal aid will expire later this month.
Katherine Estep, spokeswoman for Airlines for America, said that if it weren’t for federal assistance, the airlines ’rapid return“ would have been drastically reduced as the impacts of the pandemic would have been much more devastating for our industry. and our workforce. “
As it stands now, airlines are not expected to push for an extension of the pandemic relief, in the hope that the recent decline in travel will be a mistake in what had been a relatively strong summer.
Lawmakers were already critical of the way airlines spent their aid on the existing pandemic.
Her. Maria Cantwell
The spread of the delta variant hinders Labor Day air travel and the recovery of the industry Wyden asks the White House for details on the fuel shortage for aircraft in the midst of fire season (D-Wash.), Chair of the Senate Trade Committee, along with Republicans on the House Oversight Committee, have questioned why airlines faced staff shortages this summer despite receiving federal aid to retain the employees.
Even with declining flights, airlines are not expecting a return to nearly empty airports since the early days of the pandemic. United Airlines said Wednesday it will carry three-quarters of the passengers it carried over the 2019 Labor Day weekend, but more than triple the number of passengers it caught in 2020.