Airline Travel Numbers Heading Up and Away
The awaited recovery in U.S. business travel seems to finally be heading in to overdrive, with accelerated gains being reported by U.S. airline executives. These new and refreshing economic reports include Delta Air Lines Inc. and American Airlines, which are the largest air carriers in the U.S. The duo currently forecast second-quarter gains of at least 17 percent, as the rising demand easily outgrows any concerns regarding rising flight fares due to higher fuel prices.
International and domestic travel revenue has also increased keeping in line with the accelerating business travel sector. This about turn appears to have more sustainable volatility compared to previous downturns in the flight and travel industry. This sustainability is being given even more credibility following the slowing down of expansion plans by low cost airline carriers, who are in direct competition to the more expensive well known airline brands.
Corporate revenue is leading the way in to what looks like a formidable comeback for the aviation industry. Mr Bastian, president of Delta Air Lines recently commented at an industry conference that revenue from corporate sales was up 63% year-on-year through the end of May, and was continuing to strengthen. In comparison, unit revenue on flights to Asia jumped 50% in June, and was up 30% on trans-Atlantic services, he also said.
Delta, also aggressively boosted its estimate for second-quarter operating margins from 10% to 11%, from an April forecast of 8% to 10%.
Most of the major U.S. airlines followed suit and forecast double-digit gains in average revenue for the second quarter, due to corporate travel.
It must be said, that business travel although improving in leaps and bound is still nowhere close to being fully recovered. With some airline executives still remaining cautious, despite the growing positive trends and refuse to speculate on the near future of the industry.
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