Stocks of US airlines are rising in hopes of a rebound in air travel

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At an investor conference held Monday by JPMorgan, executives from American Airlines, United, Delta and JetBlue reported strong bookings in the traditional spring break period and several said they were also selling a growing number of tickets in the summer. .

“The last three weeks have been the best three weeks since the pandemic hit,” U.S. CEO Doug Parker said of the advanced ticket sales. “We’re getting very close to 2019 levels in total bookings.”

Parker warned that revenues remain below pre-pandemic levels, due to reduced more lucrative business bookings and overseas travel. But rising ticket orders, along with a recent sale of company bonds and another round of aid to the industry as part of the new stimulus package, make American not looking to grab cash. additional for the first time since the pandemic.
Units (UAL) stocks led the sector, rising nearly 8% in midday trading, followed by a 7% increase American (AAL). JetBlue (JBLU) increased by 5% while Alaska Air (ALK) earned 4% Delta (FROM) shares rose about 3%. Only among the major carriers Southwest (LUV) was behind the pace, just 1% more. Dallas-based Southwest warned that February traffic fell more than expected due to bad winter storms, especially in Texas. But March traffic was stronger than previously forecast.

Current bookings and traffic appear to be the beginning of the end of the pandemic’s impact on air travel, Southwest CEO Gary Kelly said at another event Monday. But he also warned that he had never experienced such a difficult time to predict future trips.

“Our hope is that by the time we get to June, where you will have had much of the population that has had access to the vaccines, we will have a chance to unbalance ourselves at least,” he said. Southwest recorded its first annual loss since 1972 last year.
More than a million passengers passed through U.S. airport security checkpoints each in the past four days, bringing the number of passengers examined to 5.2 million, according to the Transportation Security Administration. This is the largest four-day total since U.S. air travel stopped almost in late March 2020.

Although the TSA count from Thursday to Sunday was equal to 78% of where it stood in the same period last year, it only accounts for about half of the total during the same period in 2019.

But there was more good news from the airlines beyond the number of passengers. United said it believes its “basic cash flow” will be positive in March for the first time since the pandemic began. This measure takes into account the cash that the airline spends apart from the purchase of aircraft. The airline burned $ 19 million a day for these expenses in the fourth quarter and still has no plans when it will report a return to profitability.

Closing the window on free changes to the cheapest plane tickets

“We know we still can’t put Covid in the rearview mirror,” said Scott Kirby, CEO of United. “Demand for business travel will not really begin to recover until 2022 and will not return to 2019 levels until the summer of 2023.”

But all airline executives spoke of signs of improving demand, just in time for the important spring and summer travel seasons.

“There’s a lot of accumulated demand,” said Robin Hayes, CEO of JetBlue. “As people get vaccinated, they jump on planes to see people they hadn’t seen in a year.”

– CNN’s Gregory Wallace contributed to this report

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