Travel demand grows, but US airlines fear delays in plane delivery

US airlines expect big profits in the current quarter as travel spending remains strong, but delayed plane deliveries and staff shortages are hampering their efforts to fully capitalize on consumer demand.

Several US carriers, including American Airlines and southwest Airlines, indicated that delays in Boeing aircraft deliveries could hurt them in the coming months. Travel has held up despite rising inflation making leisure activities more expensive.

American Airlines, which forecasts higher-than-expected profits in the second quarter, expects to take delivery of 20 Boeing planes in the remainder of the year. Chief Executive Robert Isom said the company is concerned about possible delays that could affect its summer schedule.

“I communicate very frequently with the Boeing management team.” said. “And we need them to get their act together.”

Southwest Airlines cut its plans for capacity growth due to delays in the delivery of Boeing planes. It now expects 70 737-8 deliveries this year instead of the expected 90, after the manufacturer revealed a manufacturing problem with some aircraft.

The Dallas-based airline, which posted larger-than-expected first-quarter losses due to massive flight cancellations in December, said lower aircraft deliveries will slow its plan to cut non-fuel operating costs. this year.

“Overall, results and guidance seem a bit softsaid Stephen Trent, an analyst at Citi. Southwest shares were down nearly 5% in midday trading.

Boeing did not respond to a request for comment. The company said Wednesday that it expects deliveries of its 737 jets to slow in the second quarter. Boeing CEO, Dave Calhoun, said the timing of deliveries “will affect the summer capabilities of many of our customers. We feel terrible about it.”

thirst for travel

American Airlines returned to green in the first quarter of this year, driven by strong demand for tickets both in the United States and internationally, according to a statement released Thursday by the company.

The company’s revenue grew 37%, to US$12.2 billion, despite only offering 9.2% more seats compared to the same period in 2022. According to the company itself, travelers are willing to pay more to acquire a ticket.

“Domestic and international short-haul revenues continue to perform well, and the airline has seen a notable strengthening in demand for international long-haul flights this year.“, he pointed American Airlines.

Its expenses increased, but to a lesser extent (+10.6%), driven in particular by the rise in fuel costs (+27%). As a result, it posted a net profit of $10 million, up from a loss of $1.6 billion a year earlier.

This is the first profit in four years for a first quarter, the company said.

Thanks to the improvement in the results of the last quarters, American Airlines will be able to pay its employees a share in the profits in May for the first time in three years, said its chief executive, robert isomin a letter to staff seen by AFP.

The stock rose 0.6% in pre-open electronic trading on the New York Stock Exchange.

With information from Reuters and AFP