A post-Omicron surge in tourism and company conferences is helping a recovery in travel as,
Travelers no longer having to wear masks on planes should make it easier for people to travel
Corporate travel is finally back in business, eyeing recovery to the level of pre-pandemic.
The Omicron variant made a traditionally low season much worse.
Last week. American Airlines said it lost $1.6 billion in the first quarter, similar to the $1.4 billion loss reported by United Airlines.
*American Airlines Tweet on mask mandates
Face masks will no longer be required for our customers and team members at U.S. airports and on domestic flights (though there may be some exceptions based on local or country requirements). https://t.co/GT1lZq5TAf
— americanair (@AmericanAir) April 19, 2022
Yet airline stocks surged last week,
as investors latched onto hints of a strong summer season. Based on data for March and April, all three major U.S. legacy airlines, including Delta Air Lines, expect to be profitable and surpass pre-pandemic sales in the second quarter.
United forecasts unit revenues to be 17% above the same period of 2019, the strongest second-quarter revenue guidance in the company’s history.
Considering that higher fuel prices have caused airfares to surge, this suggests the recovery is no longer based on last-minute discounted flights to sunny spots. U.S. officials confirmed that travelers no longer have to wear masks on planes and, this should make it easier for people to travel for work.
This is essential for airlines, which often make their margins on premium cabins and only then seek to fill the rest of the plane with cheap seats.
While trans-Pacific travel is still down, Airlines believes overall corporate revenues will shoot up to 90% of 2019 levels, in the second quarter, (from 50% now)
On long-haul flights, “we’re seeing not just more customers simply sign off for flights, but fulfilling premium cabins at a better and better rate,” Chief Commercial Officer Vasu Raja told analysts.