Major U.S. airlines, including legacy carriers such as American Airlines and United Airlines and relative newcomers such as JetBlue are chasing the same, narrow segment of customers.
Cooped-up U.S. residents may be eager to take to the skies again, but a growing demand for air travel ahead of the summer may not be enough to get U.S. airlines past last year’s doldrums.
Moreover, they got saddled with debt to remain afloat during the pandemic and face structural headwinds, with concerns about inflation and rising fuel prices adding to a still-precarious situation. With the Memorial Day holiday around the corner and the lifting on pandemic restrictions in several states, summer leisure travel is certainly in full swing.
The number of flights are still lower than before the pandemic, but planes are fuller and deals, especially for the more coveted destinations, are rare, he said.As the first big trip for many people in a year or more, “they don’t want a ‘quick gateway’ trip, they want it to be a bucket-list trip,” Keyes said.
IATA this week painted a hopeful picture of air travel demand globally, but even so called its presentation “an almost full recovery.” U.S. airlines stocks have been resilient. The U.S. Global Jets ETF JETS, -0.81% has gained 68% in the past 12 months and 20% this year, outpacing gains of 38% and 12% for the S&P 500 index SPX, +0.08% in the same period.