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U.S. airlines say they've reached a turning point, marking a strong Arrival Revival

U.S. airlines say they have hit a turning point: After a poor first quarter, they expect to be profitable as Americans return to travel in the biggest numbers since the start of the pandemic.

U.S. airlines say they have hit a turning point: After a poor first quarter, they expect to be profitable as Americans return to travel in the biggest numbers since the start of the pandemic.

American Airlines is the latest carrier to give a rosy outlook for the rest of 2022. American said Thursday that although it lost US$1.64 billion in the first quarter, sales hit a record in March, and the company expects to earn a profit in the second quarter.

“Demand is as strong as we have ever seen it,” American CEO Robert Isom told analysts.

American’s upbeat view echoed similar comments from Delta Air Lines and United Airlines, which both predicted in recent days that they will earn full-year profits despite big losses in the first quarter.

Delta
Delta

Air travel was subdued in January and February by the omicron variant that caused an increase in COVID-19 cases among both travellers and airline employees.

But travellers came back in March, and airline executives believe that Americans are eager to travel this summer and won’t be discouraged by another, smaller uptick in coronavirus cases and higher airfares.

Industry officials attribute rising airfares to a combination of covering higher fuel costs, a limited number of flights compared with schedules before the pandemic, and strong demand.

“We are encouraged that indeed month to month we are seeing a greater increase in fares,” said Vasu Raja, American’s chief commercial officer.

“We are seeing a lot of strength in the fare environment.”

Karry On - American Airlines New Zealand
American Airlines Business Class

The recovery is being powered by leisure travellers, but the airlines say they are seeing more business travellers.

American said overall business travel is 80% of pre-pandemic levels, dragged down by corporate travel, which is only 50% of 2019 levels.

Isom said, however, that corporate bookings are the highest they have been since the start of the pandemic, “and we expect that to continue as more companies reopen their offices.”

Last week U.S. airlines welcomed the removal of mask mandates.

“We are relieved to see the U.S. mask mandate lift to facilitate global travel as COVID-19 has transitioned to an ordinary seasonal virus, Delta said in a statement.

“Thank you for your support in complying with the federal mask mandate and keeping each other, and our customers, safe during the pandemic.”

Source: AAP