The United Airlines Boeing 737 Max 9 aircraft lands at San Francisco International Airport on March 13, 2019 in Burlingame, California.
Justin Sullivan | Getty Images
U.S. airlines are laying the groundwork for a bounce of travel that still seems like months, if not years.
Some carriers buy new planes, while others train pilots and even hire new staff. The decisions they make now will affect how they position themselves to capitalize on a possible recovery from air travel.
Of course, U.S. airlines continue to struggle and lose $ 150 million a day, said Nick Calio, CEO of Airlines for America, an industry group representing United Airlines, American Airlines, Delta Air Lines, Southwest Airlines and others. large airlines. U.S. airlines lost more than $ 35 billion, combined, last year and passenger numbers fell more than 60 percent from 2019 to about 370 million, the lowest since 1984, according to the U.S. Department of Transportation.
“We hope to reach an equal level by the end of the year,” Calio said Tuesday in a statement to the House aviation subcommittee at a hearing on the industry’s recovery prospects.
Capacity has halved compared to last year, while passenger traffic continues to fall by more than 60%, according to the industry group.
But as vaccinations increase and new Covid-19 infections surpass early January highs, airlines are starting to see recovery glows. The House last week approved a $ 1.9 trillion Covid-19 relief package that included a third round of federal aid for airline payroll, $ 14 billion that will help soften the blow of a sting first half of the year if the Senate passes.
Signs of a thaw
Discounted operators such as Spirit Airlines and Allegiant Travel Co. are the most optimistic. Spirit plans to start training new pilots and flight attendants this month for the first time since the beginning of the pandemic.
Their business models focused on price-sensitive domestic leisure travel even before the pandemic, which has been better than international and business travel over the past year. These two segments, sometimes overlapping, were a mainstay of large network airlines before the Covid-19 spread around the world, causing entry bans, quarantine orders, and business travel breaks.
But even the big airlines that were forced to reimagine their business in the pandemic see some bright spots.
“Demand for spring break has been more robust than we expected,” Ankit Gupta, vice president of network planning and programming at United, said in an interview. “Summer booking patterns are looking up.”
Network planners like Gupta have played an even more crucial role for airlines over the past year, as they have to balance maintaining the costs of airlines while increasing the service where demands arise. Making the job harder is for travelers to book closer to their travel dates due to so much uncertainty in the pandemic.
Spring training
United said Monday it was increasing its order for Boeing 737 Max aircraft. The company did not disclose how much it was paying, but aviation consultancy Ascend by Cirium said the Max 9 aircraft are worth $ 45.5 million, a drop of 8% compared to early 2019.
United’s commercial director Andrew Nocella told staff that the purchase “helps us position ourselves to meet the demand we expect to see in 2022 and 2023 and puts us on a path to more opportunities for our employees in the future “.
Delta President Glen Hauenstein echoed Gupta’s optimistic sentiment on Monday and said at a conference by Raymond James that two weeks ago the airline experienced a significant increase in demand for short-term travel and this summer .
On Friday, Delta said it wants all about 1,700 pilots who have not returned to active duty in October. In January, the Atlanta-based company aimed to return only 400 of them.
The change will not be immediate, as they are expected to restrict travel on long-haul trips until more people are vaccinated. Airlines for America estimates that it will take until 2023 or 2024 to return to 2019 passenger volume.
John Laughter, senior vice president of flight operations at Delta, told pilots on Friday in a note that the airline is “preparing to regain flight levels from 2019 through the summer of 2023.” He noted that “customers will dictate the path to our recovery.”