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2022-04-13

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Travel Demand Roars Back. Are Airlines Ready for It?

After two years of lagging profits, airlines are finally gearing up to reap the benefits of a much-n

Travel Demand Roars Back. Are Airlines Ready for It?

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·2022-04-14
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·2022-04-13
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Are Airlines Ready for It?","url":"https://stock-news.laohu8.com/highlight/detail?id=1109016982","media":"Barron's","summary":"After two years of lagging profits, airlines are finally gearing up to reap the benefits of a much-n","content":"<html><head></head><body><p>After two years of lagging profits, airlines are finally gearing up to reap the benefits of a much-needed rebound in travel throughout 2022 as travelers look to make up for time lost during the pandemic.</p><p>More than 6.5 million people passed through TSA checkpoints last weekend, just about 500,000 shy of the 2019 figure. Airline spending, meanwhile, was 91% higher year over year in March alone, according to a monthly Bank of America Institute consumer checkpoint.</p><p>During the first quarter of 2022, airline stocks returned 4.3%, compared with the S&amp;P 500’s negative 4.9% return, calculated Bank of America Global Research analyst Andrew Didora. The group outperformed in January and February—despite the Omicron wave—and modestly underperformed in March, Didora said.</p><p>“We think the March and year-to-date results are impressive given the geopolitical environment and a 36% increase in jet fuel prices since the Russia/Ukraine conflict began and speaks to the strong demand environment as leisure and corporate travel return post-Omicron,” Didora wrote in a research note.</p><p>But the windfall from a travel resurgence could be slow to materialize uniformly across the industry as airlines navigate a challenging macroeconomic environment—from labor shortages and rising fuel costs to weather delays.</p><p>More than 10,000 domestic flights were delayed or canceled the first weekend of April, with cancellations extending well into this week.</p><p>On Monday alone, there were a total of 13,088 delays, with 5,350 of them within, into, or out of the U.S., and 2,860 cancellations, with 315 of them into or out of the U.S., according to flight tracking service FlightAware.</p><p>$JetBlue Airways(JBLU )$ canceled 55, or 5%, of its flights that day, and delayed 367, or 34%, of its flights, while <a href=\"https://laohu8.com/S/SAVE\">Spirit Airlines </a> canceled 93, or 11%, and delayed 283, or 35%. $Southwest Airlines( LUV )$, <a href=\"https://laohu8.com/S/UAL\">United Airlines </a>, <a href=\"https://laohu8.com/S/DAL\">Delta Air Lines </a>, and <a href=\"https://laohu8.com/S/ALK\">Alaska Airlines</a> also had delays or cancellations.</p><p>For some customers champing at the bit to get out and travel, the delays and cancellations have become an unexpected source of frustration and uncertainty.</p><p>“Everyone is just on high alert and on edge,” said Michele Silverman, a Harrisburg, Pennsylvania, resident whose flight back home from Orlando got canceled on April 4.</p><p>Silverman was flying back after running in the Disney Springtime Surprise run weekend. Although she had seen the flurry of cancellations throughout the weekend, exacerbated by weather conditions, she was hopeful that she would make her Frontier ( ULCC ) flight. After a short delay, the flight eventually got canceled because of mechanical issues, so she was forced to book a new flight through Spirit for the following day, since Frontier didn’t have a flight to Harrisburg until later that week.</p><p>Silverman’s new flight was delayed for more than an hour, as the crew was missing one flight attendant.</p><p>“I’ve had flights delayed, but it’s the first time I’ve ever had a flight canceled and been stranded before, so that was not enjoyable,” she added.</p><p>Frontier didn’t respond to Barron’s requests for comment.</p><p>Last week, Alaska Airlines announced it was reducing 2% of its flights through the end of June to match its current pilot capacity. Due to delays in training, the airline had 63 fewer pilots prepared to fly in April than originally planned for, the company said.</p><p>As travel rebounds, airlines are scrambling to recruit more pilots and meet current demand, but 83% of regional carriers are finding it challenging to recruit talent, according to an Oliver Wyman study. In North America, the pilot shortage is projected to reach more thasn 12,000 pilots by 2023, amounting to about 13% of total demand, the study found. Alaska Airlines calculates that during the pandemic, some 10,000 pilots left the industry.</p><p>The shortage may be putting strain on current pilots and employees. Some Alaskan Airlines pilots conducted an informational picket on April 1 over management’s “lack of progress” on contract negotiations.</p><p>“Alaska Airlines failed to properly plan for increased travel demand and take the steps necessary to ensure it attracted and retained pilots,” the Alaska Airlines Master Executive Council of the Air Line Pilots Association said in a press release.</p><p>“Now, they’re trying to distract the public from their mismanagement and blame the pilots who helped save their company,” the release added. “Pilot leaders have been warning for years that pilots will choose to fly for other airlines due to an inadequate contract that will only exacerbate existing staffing challenges.”</p><p>Delta Air Lines pilots have also engaged in informational picketing over the last few months, expressing concerns over their schedules and flight times.</p><p>“This informational exercise by some of our off-duty pilots won’t disrupt our operation for our customers,” Delta said in an emailed statement. “We continuously evaluate our staffing models and plan ahead so that we can recover quickly when unforeseen circumstances arise, and the resilience of the Delta people is unmatched in that regard.”</p><p>For many air carriers, disagreements between labor unions and management “could have a material impact on the company’s network efficiency and could produce customer service problems,” Citi analyst Stephen Trent in a research note. Moreover, bargaining concessions could turn out to be more expensive than expected, Trent added, pressuring margins.</p><p>But the biggest pressure to margins could come in the shape of rising fuel costs. On Tuesday, American Airlines ( AAL ) indicated that it expects its cost for jet fuel to be between $2.80 and $2.85 per gallon for its first quarter, up from previous projections guiding for $2.73 and $2.78 per gallon. Delta, which reported first-quarter earnings Wednesday, attributed an 11% increase in operating expenses partly to higher fuel prices, which the airline sees rising even more in the second quarter.</p><p>“Rising fuel prices will have an impact on airline tickets as such that it creates demand destruction, where people will stop wanting to travel,” said Peter Earle, economist at the American Institute for Economic Research.</p><p>American Airlines announced in February it would reduce international flights this summer due to production delays for new Boeing ( BA ) 737 jets. These cuts were in addition to route reductions previously announced in December.</p><p>Yet despite the challenges, today’s airline industry isn’t the same as the one that suffered after it was caught off guard by the Sept. 11 attacks, Earle said.</p><p>“They’re a lot more flexible, and they’ll be able to deal with some of the things that are happening right now,” he said.</p></body></html>","source":"lsy1610680873436","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Travel Demand Roars Back. 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Are Airlines Ready for It?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2022-04-13 22:13 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.marketwatch.com/articles/airline-flights-travel-demand-cancellations-51649850589?mod=newsviewer_click><strong>Barron's</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>After two years of lagging profits, airlines are finally gearing up to reap the benefits of a much-needed rebound in travel throughout 2022 as travelers look to make up for time lost during the ...</p>\n\n<a href=\"https://www.marketwatch.com/articles/airline-flights-travel-demand-cancellations-51649850589?mod=newsviewer_click\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"ALK":"阿拉斯加航空集团有限公司","DAL":"达美航空","UAL":"联合大陆航空","AAL":"美国航空","JBLU":"捷蓝航空"},"source_url":"https://www.marketwatch.com/articles/airline-flights-travel-demand-cancellations-51649850589?mod=newsviewer_click","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1109016982","content_text":"After two years of lagging profits, airlines are finally gearing up to reap the benefits of a much-needed rebound in travel throughout 2022 as travelers look to make up for time lost during the pandemic.More than 6.5 million people passed through TSA checkpoints last weekend, just about 500,000 shy of the 2019 figure. Airline spending, meanwhile, was 91% higher year over year in March alone, according to a monthly Bank of America Institute consumer checkpoint.During the first quarter of 2022, airline stocks returned 4.3%, compared with the S&P 500’s negative 4.9% return, calculated Bank of America Global Research analyst Andrew Didora. The group outperformed in January and February—despite the Omicron wave—and modestly underperformed in March, Didora said.“We think the March and year-to-date results are impressive given the geopolitical environment and a 36% increase in jet fuel prices since the Russia/Ukraine conflict began and speaks to the strong demand environment as leisure and corporate travel return post-Omicron,” Didora wrote in a research note.But the windfall from a travel resurgence could be slow to materialize uniformly across the industry as airlines navigate a challenging macroeconomic environment—from labor shortages and rising fuel costs to weather delays.More than 10,000 domestic flights were delayed or canceled the first weekend of April, with cancellations extending well into this week.On Monday alone, there were a total of 13,088 delays, with 5,350 of them within, into, or out of the U.S., and 2,860 cancellations, with 315 of them into or out of the U.S., according to flight tracking service FlightAware.$JetBlue Airways(JBLU )$ canceled 55, or 5%, of its flights that day, and delayed 367, or 34%, of its flights, while Spirit Airlines  canceled 93, or 11%, and delayed 283, or 35%. $Southwest Airlines( LUV )$, United Airlines , Delta Air Lines , and Alaska Airlines also had delays or cancellations.For some customers champing at the bit to get out and travel, the delays and cancellations have become an unexpected source of frustration and uncertainty.“Everyone is just on high alert and on edge,” said Michele Silverman, a Harrisburg, Pennsylvania, resident whose flight back home from Orlando got canceled on April 4.Silverman was flying back after running in the Disney Springtime Surprise run weekend. Although she had seen the flurry of cancellations throughout the weekend, exacerbated by weather conditions, she was hopeful that she would make her Frontier ( ULCC ) flight. After a short delay, the flight eventually got canceled because of mechanical issues, so she was forced to book a new flight through Spirit for the following day, since Frontier didn’t have a flight to Harrisburg until later that week.Silverman’s new flight was delayed for more than an hour, as the crew was missing one flight attendant.“I’ve had flights delayed, but it’s the first time I’ve ever had a flight canceled and been stranded before, so that was not enjoyable,” she added.Frontier didn’t respond to Barron’s requests for comment.Last week, Alaska Airlines announced it was reducing 2% of its flights through the end of June to match its current pilot capacity. Due to delays in training, the airline had 63 fewer pilots prepared to fly in April than originally planned for, the company said.As travel rebounds, airlines are scrambling to recruit more pilots and meet current demand, but 83% of regional carriers are finding it challenging to recruit talent, according to an Oliver Wyman study. In North America, the pilot shortage is projected to reach more thasn 12,000 pilots by 2023, amounting to about 13% of total demand, the study found. Alaska Airlines calculates that during the pandemic, some 10,000 pilots left the industry.The shortage may be putting strain on current pilots and employees. Some Alaskan Airlines pilots conducted an informational picket on April 1 over management’s “lack of progress” on contract negotiations.“Alaska Airlines failed to properly plan for increased travel demand and take the steps necessary to ensure it attracted and retained pilots,” the Alaska Airlines Master Executive Council of the Air Line Pilots Association said in a press release.“Now, they’re trying to distract the public from their mismanagement and blame the pilots who helped save their company,” the release added. “Pilot leaders have been warning for years that pilots will choose to fly for other airlines due to an inadequate contract that will only exacerbate existing staffing challenges.”Delta Air Lines pilots have also engaged in informational picketing over the last few months, expressing concerns over their schedules and flight times.“This informational exercise by some of our off-duty pilots won’t disrupt our operation for our customers,” Delta said in an emailed statement. “We continuously evaluate our staffing models and plan ahead so that we can recover quickly when unforeseen circumstances arise, and the resilience of the Delta people is unmatched in that regard.”For many air carriers, disagreements between labor unions and management “could have a material impact on the company’s network efficiency and could produce customer service problems,” Citi analyst Stephen Trent in a research note. Moreover, bargaining concessions could turn out to be more expensive than expected, Trent added, pressuring margins.But the biggest pressure to margins could come in the shape of rising fuel costs. On Tuesday, American Airlines ( AAL ) indicated that it expects its cost for jet fuel to be between $2.80 and $2.85 per gallon for its first quarter, up from previous projections guiding for $2.73 and $2.78 per gallon. Delta, which reported first-quarter earnings Wednesday, attributed an 11% increase in operating expenses partly to higher fuel prices, which the airline sees rising even more in the second quarter.“Rising fuel prices will have an impact on airline tickets as such that it creates demand destruction, where people will stop wanting to travel,” said Peter Earle, economist at the American Institute for Economic Research.American Airlines announced in February it would reduce international flights this summer due to production delays for new Boeing ( BA ) 737 jets. These cuts were in addition to route reductions previously announced in December.Yet despite the challenges, today’s airline industry isn’t the same as the one that suffered after it was caught off guard by the Sept. 11 attacks, Earle said.“They’re a lot more flexible, and they’ll be able to deal with some of the things that are happening right now,” he said.","news_type":1},"isVote":1,"tweetType":1,"viewCount":626,"commentLimit":10,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"symbols":[],"verified":2,"subType":0,"readableState":1,"langContent":"EN","currentLanguage":"EN","warmUpFlag":false,"orderFlag":false,"shareable":true,"causeOfNotShareable":"","featuresForAnalytics":[],"commentAndTweetFlag":false,"andRepostAutoSelectedFlag":false,"upFlag":false,"length":6,"xxTargetLangEnum":"ORIG"},"commentList":[{"id":101169181,"commentId":"101169181","gmtCreate":1649866665629,"gmtModify":1663246695738,"authorId":3585983433962847,"author":{"id":3585983433962847,"idStr":"3585983433962847","authorId":3585983433962847,"name":"tanpp2307","avatar":"https://static.tigerbbs.com/b4cb1adebe779f631f65a6b4332f7bc5","vip":1,"crmLevel":5,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":9080831857,"objectIdStr":"9080831857","type":1,"supId":0,"supIdStr":"0","prevId":0,"prevIdStr":"0","content":"Wait out for a while first.","text":"Wait out for a while first.","html":"Wait out for a while first.","likeSize":0,"commentSize":0,"subComments":[],"verified":10,"allocateAmount":0,"commentType":"valid","coins":0,"score":0},{"id":101168159,"commentId":"101168159","gmtCreate":1649863506494,"gmtModify":1663246689745,"authorId":3574796007598692,"author":{"id":3574796007598692,"idStr":"3574796007598692","authorId":3574796007598692,"name":"SC2021","avatar":"https://static.tigerbbs.com/7db1014f5edc3cd0a7562d4262d0a5a5","vip":1,"crmLevel":2,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":9080831857,"objectIdStr":"9080831857","type":1,"supId":0,"supIdStr":"0","prevId":0,"prevIdStr":"0","content":"Ok","text":"Ok","html":"Ok","likeSize":0,"commentSize":0,"subComments":[],"verified":10,"allocateAmount":0,"commentType":"invalid","coins":0,"score":0}],"hasMoreComment":true,"orderType":2}