Airlines from America to Australia are ramping up flights in June and July, boosting hopes for a pickup in tourist traffic even as bigger-spending business and global travel remains sluggish during the ongoing pandemic.
American Airlines (AAL.O) and United Airlines (UAL.O) each announced more flights to key U.S. business and leisure destinations where national parks and outdoor recreational spaces are reopening after months of lockdowns and travel curbs, sending their shares sharply higher.
Chicago-based United is adding more non-stop flights as well as servicing markets like Aspen, Colorado and Jackson Hole, Wyoming where it said “social distancing is a natural feature” in the scenic landscapes.
“Leisure travel has been the most missed activity during lockdown across age and income demographics, even more so than things like restaurants,” said Jason Guggenheim of Boston Consulting Group, which has surveyed consumers in the United States and Europe.
“But it’s going to take business travel longer to come back,” he said, noting work-from-home models will remain in place for some time.
Even with the schedule increases, analysts expect overall U.S. airline capacity will remain drastically lower this year; and without business travel, yields will likely remain negative, they said. Yield is the revenue an airline makes per mile flown.
Australia’s Qantas Airways Ltd (QAN.AX) and Air New Zealand Ltd (AIR.NZ) outlined plans on Thursday for significant boosts to domestic capacity, while Emirates and Etihad Airways are restarting transit flights through hub airports in Abu Dhabi and Dubai.
In Europe, Iberia – part of the International Consolidated Airlines Group (ICAG.L) – told customers on Thursday it is starting a schedule of regular flights from Spain in July as a first step to building back a full service.