{"id":3855,"date":"2023-01-28T15:00:03","date_gmt":"2023-01-28T15:00:03","guid":{"rendered":"https:\/\/entertainment.runfyers.com\/index.php\/2023\/01\/28\/airlines-say-demand-shows-few-signs-of-letting-up-the-points-guy\/"},"modified":"2023-01-28T15:00:03","modified_gmt":"2023-01-28T15:00:03","slug":"airlines-say-demand-shows-few-signs-of-letting-up-the-points-guy","status":"publish","type":"post","link":"https:\/\/entertainment.runfyers.com\/index.php\/2023\/01\/28\/airlines-say-demand-shows-few-signs-of-letting-up-the-points-guy\/","title":{"rendered":"Airlines say demand shows few signs of letting up – The Points Guy"},"content":{"rendered":"


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Despite the looming concerns of a recession, people still want to spend on travel.<\/p>\n

That was the big takeaway from the U.S. airline industry\u2019s fourth-quarter earnings season, where the last of the nation\u2019s big carriers reported their results this past week.<\/p>\n

American Airlines<\/a> was the latest to say it\u2019s been earning record revenue as demand has continued to soar since the depth of the pandemic. This trend seems to show little sign of slowing \u2014 for now.<\/p>\n

The latest results came on Thursday as four big airlines reported earnings for the fourth quarter of 2022.<\/p>\n

American raked in a net income of $803 million, handily topping Wall Street expectations Thursday by saying it earned record revenue during the fourth quarter. The Fort Worth-based carrier said it earned 16.6% more during the quarter than in the same one in 2019, despite flying at 6.1% less capacity.<\/p>\n

\u201cThis is our best ever post-holiday booking period with broad strength across all entities and travel periods,\u201d American Airlines CEO Robert Isom said on the company\u2019s quarterly financial results call. \u201cDemand for domestic and short-haul international travel continues to lead the way. We expect a strong demand environment to continue in 2023 and anticipate further improvements in demand for long haul international travel this year.\u201d<\/p>\n

American\u2019s fourth-quarter result mirrored that of competitors, Delta Air Lines<\/a> and United Airlines<\/a>, which each also reported record profits and promising 2023 forecasts.<\/p>\n

The other major Dallas-Fort Worth area carrier, Southwest Airlines<\/a>, didn\u2019t have such rosy earnings.<\/p>\n

Southwest said it anticipated demand to pick back up after its holiday meltdown. However, the airline reported a fourth-quarter loss of $220 million. Much of the carrier\u2019s earnings call centered around the cataclysmic meltdown that occurred around Christmas and bled into the New Year. Executives repeatedly apologized for the operational failure.<\/p>\n

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\u201cFirst and foremost, I want to apologize again to our customers and our employees for the impact the operational disruption had on them and on their holiday plans,\u201d Southwest CEO Bob Jordan said on the call. \u201cWe are intensely focused on reducing the risk of repeating that type of operational event again.\u201d<\/p>\n

The episode, which caused the airline to cancel<\/a> nearly 17,000 flights, cost it approximately $390 million in operating expenses. Most of those expenses went toward reimbursing customers, according to Southwest CFO Tammy Romo. Jordan said the airline is close to completing approximately 95% of those reimbursement requests.<\/p>\n

The Department of Transportation also launched<\/a> an investigation into the Southwest meltdown to see whether the airline\u2019s schedule was unrealistic. Southwest said that it is cooperating with the DOT in the investigation.<\/p>\n

Jordan added that 25% of customers who received 25,000 Rapid Rewards points due to the fiasco have already booked future travel with the airline. Some used points and others booked with cash.<\/p>\n

\u201cI take that as a sign of confidence that customers understand that we messed up there,\u201d Jordan said on the call. \u201cWe did everything that we could to make it right.\u201d<\/p>\n

However, Southwest is still reeling from its holiday mess as executives said bookings have softened in January. Southwest CCO Ryan Green said the slowdown in bookings was just isolated to January and the first half of February, as part of a \u201changover” effect from the incident.<\/p>\n

Alaska Airlines and JetBlue \u2014 the two other big airlines to report quarterly earnings on Thursday \u2014 also said demand trends for 2023 were promising. Both companies bested analysts\u2019 forecasts.<\/p>\n

Robust demand from leisure travelers seems to drive the trend. Post-pandemic, leisure travel has returned much quicker than business travel.<\/p>\n

\u201cLooking further ahead, we are excited to continue building on last year’s record performance as we expect another strong year of revenue growth ahead of us, underpinned by robust leisure demand and multiple network and commercial initiatives,\u201d shared JetBlue COO Joanna Geraghty.<\/p>\n

The public\u2019s continued appetite for travel has been good for airlines. It’s likely to spur higher fares as travelers keep booking flights.<\/p>\n

That\u2019s not to say there aren\u2019t some dark clouds on the horizon for the industry.<\/p>\n

A pilot shortage<\/a> has squeezed the industry \u2014 especially at regional carriers, which have responded by hiking pay and labor costs. Supply chain issues have slowed<\/a> the delivery of everything from new airplanes to spare parts.<\/p>\n

Also, renewed concerns over outdated aviation infrastructure due to the recent Federal Aviation Administration system meltdown<\/a> have some airlines wary of even more disruptions.<\/p>\n

United CEO Scott Kirby made headlines last week for saying it\u2019s difficult for airlines to operate like it\u2019s 2019, given the strains that have afflicted the industry since the pandemic.<\/p>\n

Many airlines have only recently returned to adequate staffing levels after many employees retired or took buyouts during the pandemic. There have been months of speculation among financial forecasters about the possibility of a U.S. recession \u2014 something that could derail the industry\u2019s recovery.<\/p>\n

For now, though, airlines remain relatively optimistic about 2023.<\/p>\n

\u201cWe overcame many challenges together throughout this past year, and we made tremendous progress in restoring the business coming out of the pandemic,\u201d JetBlue CEO Robin Hayes said. \u201cAnd we’re set up to further build on that success here in 2023, with a disciplined plan to continue strengthening our foundations, both operationally and financially.\u201d<\/p>\n<\/div>\n


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Despite the looming concerns of a recession, people still want to spend on travel. That was the big takeaway from the U.S. airline industry\u2019s fourth-quarter earnings season, where the last of the nation\u2019s big carriers reported their results this past week. American Airlines was the latest to say it\u2019s been earning record revenue as demand […]<\/p>\n","protected":false},"author":1,"featured_media":3856,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[],"class_list":{"0":"post-3855","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-travel"},"_links":{"self":[{"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/posts\/3855","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/comments?post=3855"}],"version-history":[{"count":0,"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/posts\/3855\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/media\/3856"}],"wp:attachment":[{"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/media?parent=3855"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/categories?post=3855"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/tags?post=3855"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}