Six weeks ago I wrote that recovery in travel could be expected to stall out in the fall.
- As kids go back to school leisure travel would begin to dry up. That traditionally happens anyway.
- Normally business travel picks up the slack, but business travel will only return gradually.
- The Delta variant would depress travel, both because some people might become less inclined to travel and because some jurisdictions would bring back restrictions that make the destination less appealing.
The Delta variant also has some businesses delaying return to office. Without workers in offices full time, they’re not going to be having visitors. They’re also less likely to require travel, both to conferences and clients but also to bring remote workers together.
I also suggested at the time, by the way, that the Delta variant could infect 36 million people in the U.S. and cause the mask mandate to be extended. A couple of weeks ago airline CEOs started talking about their hope to see the mask mandate end, another that having this requirement on travel (which once might have given people confidence to fly) is bad for business.
The stalling out in travel is what we appear to be seeing already, with forward purchases. (HT: @crucker)
JPMORGAN: “Retail spending outcomes have fallen short of our .. model in recent months. Our US card data reinforces this note of caution, showing a loss of momentum for airline spending and leveling off for restaurant spending this quarter.” $XAL pic.twitter.com/Tgt1VU0pLF
— Carl Quintanilla (@carlquintanilla) August 10, 2021
While in some sense limited by international travel restrictions, airline capacity remains flat among U.S. carriers at down 15% to pre-pandemic levels. A continued growing domestic air travel segment might lead to greater recovery with more full utilization of planes locally that aren’t being sent abroad.
TSA checkpoint numbers remain stalled out at less than 80% of 2019 – and that’s before the end of summer, back to school, and a decline in future booking spend.
And now Southwest Airlines is warning of lower bookings and rising cancellations and they no longer project profitability this quarter.
No, it’s stalling out because 3M isn’t able to keep up with the demand for duct tape.
Investors saw the stall out emerging beforehand as airline share prices started a decline around June 1
This is just one of many possible reasons. Sure, there are people out there that still for some odd reasons feel that travel by air is just the worst thing anyone can do with rising cases of a virus. However, this ignores the track record if airlines operating with relatively few issues early in the pandemic WITHOUT mask mandates, later with mask requirements that were enforced sporadically and then now with the draconian mask rule enforcement that supersedes all other rules including traditional passenger safety. Yes, I witnessed flight attendants ignore FAA rules like seatbelt enforcement, prohibitions on luggage on the floor in bulkhead and of course phone usage while they quickly review exit row roles and ready the cabin for takeoff….but the mask check that is serious business.
So, I think your assessment is lacking quick a bit Gary. Many people have decided to sit out air travel while all the nonsense plays itself out. As we see daily reports of all kinds of terrible traveler behavior often linked to the same issues a few years back on this blog many argued were draconian on the part of airlines. How dare airlines enforce FAA safety rules, if a person needs to go to the bathroom during takeoff it’s their right, you can’t arrest someone who refuses to leave the airplane after being told to correct their behavior, they must be treated kindly. Now, the same people are lauding United for vaccination mandates and are ecstatic when people are dragged off airplanes when they can’t keep their 2 year old’s mask on perfectly for the whole 5 hour flight. No, I’m not going to pay good money to be part of this. I’m a precious 100 flight per year flier and I won’t return until this mess is cleaned up. All of the futile attempts to make airplanes perfectly safe for people who completely don’t understand viruses and that we come into contact with germs and viruses all day everyday and that preventing coming in contact with them is futile and irrational and that strengthening our immune systems is the only way to go has in the process ruined air travel and made it into a circus. It is time the circus leave town and we get back to air travel as it should be.
@ Gary — Whatever the reason, I don’t expect 100% capacity to return until 2024-2025. Welcome to the new normal.
I think we are overlooking a segment of the population not booking flights because it’s a hassle flying with air delays, flight cancellations, long security lines, rude people, etc.
“Many people have decided to sit out air travel while all the nonsense plays itself out…” Mark Rascio.
Absolutely. I have 2 international trips planned this fall and now I am re-thinking both of them. I’m fully vaccinated and I don’t relish the idea of sitting 15+ hours in J class, wearing a mask. That’s not part of the flying-in-J experience, for me. And do I really, REALLY want to be flying in the back of the bus right now, in the “duct tape zone”? No, thanks.
And even if I do get over the pond, after possibly–or, possibly not–being able to get a PCR test <72 hours before my flight, then I have to live with the day-to-day annoyance of wearing a mask outside(!) in some places. Or waking up to find that I might be in lockdown, or that I might not be able to travel to my next destination. Again, no thanks.
I believe we have to see: 1) this 2nd wave of Delta finish its course; 2) wait until vax rates hit the 70% mark in 'some' countries, and 3) see a unified strategy among different countries to come up with some kind of tool to make international travel easier. Oh, can't forget 4) drop some of these draconian mask mandates.
Just one anecdotal data point. I’ve started cancelling several booked flights in August/September as a series of my clients have switched back to remote meetings. I doubt that my experience is unique.
Add me to Mark and Kimmie on the list of people sitting it out. When the misery of flying outweighs the business benefits and makes leisure traveling a bundle of stress, people who have a choice will opt for “no thanks.”
@Kimmie A. Vax rates may or may not hit 70% in the US but that’s not nearly sufficient. They are well over that in the UK and it’s now dawning on people that, even at 80+%, herd immunity won’t happen. The vaccines just aren’t effective enough against Delta. So, the reality is that we need to learn to live with COVID for the foreseeable – and, if that’s the case, then travel won’t return to normal for many years. As a minimum, crossing borders will require vaccination plus test with the concomitant risk that you get stranded because you test positive. And that’s after countries like the US open their borders in the first place.
It is still too much of a hassle and too unpredictable to fly international. Much of my prior international travel was for business. and I don’t see those meetings coming about now until next spring. Prior to the new variant, I think the airlines were expecting travel to expand by late summer, but instead it is going in the other direction. Domestically, I am still traveling some for personal (and usually paid F), enough to make UA plat again back in July, but don’t have a business meeting across the country till October, and I wonder about that being cancelled.
What does the Magic 8-Ball say? “Reply hazy try again.”
I’m also unsure of what international travel is going to hold in the months ahead. We already cancelled a trip to Portugal last month as Delta started spreading there and many businesses had to close early. Another mid-October trip to Spain is looking less certain by the day, and if the mask mandates are still in place we’ll likely reschedule. We just did a quick 3 1/2 hour trip and while wearing a mask when not eating or drinking wasn’t the worst experience ever, my opinion would probably change on a 7-hour hop over the pond.
On the flip side, my company is relaxing it’s business travel restrictions but also delaying a full return to office for a few weeks.
You guys are really over thinking this:
1. Most people took vacations this summer. Schools nationwide have restarted or will soon. Vacation travel is winding down. Leisure travel has recovered mostly.
2. Hurricane Season is ramping up, so in the southeast USA/Carribbean – it’s never been a desirable time.
3. Business convention travel really never recovered. It just sputtered.
4. International travel for business is barely on life support.
The full recovery will happen for business when we hit herd immunity either through vaccine or death. Take your pick.
Don’t really understand why the mask mandate needs to be brought up in yet another article. Travel is dropping because covid is surging and people are dying. Florida set yet another daily record for covid cases yesterday with 24,753 new cases. They also set a record number of hospitalizations at 15,449 patients and you know who is filling those hospitals? Mainly people between the ages of 25 and 55 who are unvaccinated and mostly have no underlying health conditions. This is why travel is dropping off. Not some mask mandate. Children’s hospitals are filling up with kids with covid.
I just cancelled an Oct. PRCLHR business class booking from that United sale. The precipitating event was UA changing the outbound leg from a 1hr hop to LAX + 2.5 hr layover then the nice long overnight to LHR to a moved up by 7.5 hr departure to DEN, then a leg to IAH, then a 5hr layover, then the leg to LHR. So 7.5 hrs earlier (and overall), an extra leg, and a lot more waiting in the terminal. This is how they treat business class during a pandemic?
However, we really wanted to go. But the itinerary included a stay in London, a hop over to Brussels, and outing to Amsterdam, and a week or so in Paris. My friends in London and Brussels could offer no advice on what the border protocols were going to be. My wife is an engineer for a red state corp and the delta variant is ripping through the plants. From this week, WFH is now back in place, as well as a no exceptions mask mandate. We’re both vaccinated, have laminated cards, and the thought of trying to cross borders with the ever shifting quarantines and vaccine documentation is very uh… concerning? There is one hospital with one line in Paris for all of France to convert your US paper card to a Pass Sanitaire. Not scalable.
So I took Gary’s previous advice on VFW and used the UA scheduling abuse to get a full refund of my non-refundable business bookings. Thanks United! It took 45 min. on hold and then like 3 min with the agent to get it done. Seems like they’re well practiced.
Now I still have the problem of burning up $2300 of UA travel credit. Maybe Mexico.
Well I’m sure to have a whole row to myself come this oct 4th for my trip to spain! In July to Italy had plenty rows empty and everyone had an empty middle seat on united to milan, was worst going back home with empty seats.
Travel right now is the best in my life. I’m loving it.
Unvaccinated (no intention, what’s the point?)
Hit 50 countries since 2019. Flying to new countries every 2 weeks.
I love that everyone is staying home.
Macchi Picchu when empty? Amazing
Serengeti? Camped *alone* wild!
Namibia?? Empty. Soooo nice.
I hope you all stay home, it’s amazing in the world when you don’t watch the mainstream news.
Also, all of you staying home still, you’re just hurting minorities and front line workers the most.
Your habits hurt the locals in every city around the world that used to have tourists.
So, congrats! You’re hurting the poor because you have the luxury of staying in your house.
Nicely done!
@Bill–I live in Florida. Yes, it’s a mess. Problem is, without more vaxxed people AND/OR herd immunity, what is to be done? Are we going to wear masks ad infinitum to protect those who aren’t vaxxed? At some point we have to say, enough is enough. And the demographics of those unvaxxed in the hospitals, or the children becoming ill, are the least likely to travel on the international business level. A high percentage of the unvaxxed (or children of the unvaxxed) are lower- and middle-lower income demographic, most of them not in the group who will be flying anytime soon. Plus, school has already started here.
@RLC, you will be able to file for your French Pass Sanitaire online, get a QR code that is good throughout Europe. The info hit the news this morning, and Gary has a link in another post. For the sake of convenience, here it is:
https://www.diplomatie.gouv.fr/en/coming-to-france/coronavirus-advice-for-foreign-nationals-in-france/coronavirus-statements/article/applying-for-a-covid-certificate-if-you-were-vaccinated-abroad-procedure-for
@George. Go troll someplace else.
@Bill
Has it occurred to you and others that the Florida demographic you describe is illegal immigrants arriving across the southern border? There is ample evidence that the destination of choice for many is Florida
@Kimmie A
The USA doesn’t require a PCR Covid test to return to the USA. It can be the simple antigen test. And, only the airline checks your results, when checking in. CBP doesn’t even ask for your results. The bigger issue is getting tests for destinations. Some destinations, require PCR tests, and they require the test be done 48-72 hours prior to departure. That isn’t easy.
As far as the drop off in air travel, I agree with @DanG. This drop in bookings is a natural cycle. With some taking precautions for the Delta variant. I think most people are fine with wearing a mask for few hours. Only anti-maskers feel differently.
@George: 99%+ of current U.S. COVID cases are among the unvaccinated. Those people — and you — are not victims — they are volunteers. They — and you — are putting up your hands and saying, “Infect me”. And, some of the expert “talking heads” on the media say it is “highly likely” that unvaccinated people will contract the disease.
Good luck — you will need it.
Gary, you should implement bans for dangerous medical misinformation just like other social platforms. Lots of good and reasonable discussion on this thread, but with regard to Mark Rascio and this comment: “ All of the futile attempts to make airplanes perfectly safe for people who completely don’t understand viruses and that we come into contact with germs and viruses all day everyday and that preventing coming in contact with them is futile and irrational and that strengthening our immune systems is the only way to go.”
I wish you luck with your non-medical uninformed statement. I’d be more than happy to mail you some vials of Ebola, tuberculosis, anthrax, measles, etc., if you’ll provide your address. Then we will know if your theory of “strengthening our immune systems is the way to go” is correct. This is an unprecedented worldwide pandemic killing millions. We have 620,000 dead here who otherwise might be alive right now. Currently hospitals are again overwhelmed and ICUs are now getting children – assuming they even have available beds. The unvaccinated and folks just like you (denying basic public and personal health precautions) are the ones filling the hospitals and calling 911 right now. But best of luck to you. Maybe you and Rand Paul, DeSantis, and Abbott can go play a round of golf to pass the time till 2022 when you try maintain sociopaths in positions of govt responsibility.
I’m with @George.
International travel has been great these last 15 months. Fewer crowds in the planes, at the places and people happy to see some tourists, good return for your $$$.
Please, everyone stay home, have a few more places I want to visit.
@Retired Lawyer
Worry about yourself. I’m not getting vaxxed and i’m done wearing the mask.
@Mark Rascio @George @Patti and @Snowe – future winners of Darwin Awards! And many thanks to them for working hard at improving the gene pool.
@John B
The US DHS has most certainly done spot checks for covid tests upon arrival in the US.
I have three flights scheduled for the rest of the year. I only intend on cancelling if the reason for going is cancelled because of COVID. That is a distinct possibility for one of them as it’s far enough out that I can’t predict where things will be. As for the other two, one is in two weeks and it’s looking less likely that the event will get cancelled because of COVID. The third is Dorkfest and that’s entirely elective on my part (though there may be an even conflict that weekend might happen that would force me to pull out of Dorkfest).
But honestly US based travel was never an issue from a COVID standpoint. It’s international travel (to Asia) that I really want to do but that’s just impossible with Delta (and maybe soon Lambda) running roughshod over the world. Up until a couple months ago I had hope for some resumption of international travel in 2022 but now I think 2022 will be like 2020 and 2021.
We’re complaining about not having enough people vaccinated in the US but we have it really good here from a vaccine standpoint. The rest of the world has it a lot worse…especially those countries that would be on my travel list. So even if/when we get Delta back under control, it’s still going to be blasting through the rest of the world and those travel controls will still be in place.
I wonder what I am doing wrong. Travel right now is unpleasant. Restrictions and places closed. Flights booked to the Max and prices as high as ever.
I believe that what is happening is people are realizing that just because you Travel and leave your town, the next place you arrive also is has the active pandemic and things are as unpleasant there as they are at home.
It is not really the mask mandate or fear of Delta varient that is driving travel down rather it is the pandemic pain making travel less enjoyable for the costs.
I should add that prices in the Fall and Spring are still high despite the predicted falloff in travel. Airlines were desperate to recover lost revenue and prices remained high.
That’s going to change, due to the Delta variant. But I suspect that prices will remain high though no one will be buying.
At the beginning of the summer I thought I would be traveling to Europe in the mid or late fall. I wasn’t, however, willing to spend any money on flights, trains, etc until 30 days before the trip. Now I’m glad I was cautious. I suspect my trip will happen in the spring of 2022 instead.
@Tim Dunn
Florida has no international land borders. We are surrounded by water on 3 sides and only connect to other US States.
So crossing the Southern Border will not take you to Florida