On July 1, 2023, a plane from Delta Airlines and American Airlines on Ronald Reagan Washington Airport in Arlington, Virginia, can be seen on July 1, 2023.
Stefani Reynolds | AFP | Getty pictures
The airlines reduce their profit and sales estimates in the first quarter and warn that a weaker economic background is burdening the question of travel.
Before a JPmorgan industry conference, American airlines On Tuesday, it expects between 60 cents per share and 80 cents per share per share in the first three months of the year. It is said that sales would probably be flat in the year in January in the year of an increase of up to 5%.
In a securities registration, Americans said that “the income environment was weaker due to the effects of flight 5342 and the softness in the home, especially in March, was weaker than was initially expected” with reference to the fatal collision of one of his regional jets and a helicopter of the army in Washington, DC, in January.
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The forecast followed Delta air lines After the end of the market on Monday, the estimates canceled in the first quarter after the market. Delta said that his prospects are “influenced by the recent reduction in consumer and company trust through the increased macro uncertainty and the softness of domestic demand”.
In addition to the leisure trips, the airlines have noticed a severe decline in government tours since the beginning of the latest Trump administration and their guidelines such as tariffs, government and other cost cuts.
“I think the people are careful and they retire a little on the road, not in an organized way, but only to see what should happen, whether it is a trade and tariff challenges or macroeconomic changes or just a little about the unrest of the market that we all see,” said CEO Ed Bastian, said at the JPMorgan conference.
United airlines CEO Scott Kirby repeated this feeling at the same conference.
“We also saw weakness in the demand market,” said Kirby. The state trips are about 2% of the United company, but the trips of other employees are also affected, such as consultants and contractors, which makes up for a further 2% to 3%.
“We saw some bleeding on the domestic leisure market,” said Kirby.
A cost -saving measure: Kirby said that United retired early, aircraft, for which it would otherwise have to spend $ 100 million for overhauling engines this year.
Both managers were more optimistic about long-term trends and bright spots such as long-distance and premium travel issues.
The Delta shares ended the day by more than 7% lower. United shed 2% and American stocks fell by more than 8%.
Southwest Airlines Also reduce its income instructions to no more than 4% compared to a forecast of up to 7% in the first quarter compared to the previous year. On Tuesday, the airline also announced an end to its “two bags fly free” guidelines in order to calculate customers for the first time from May for a checked luggage. The stocks rose by more than 8%.
Jetblue Airways The stocks ended by 4% higher.
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