As COVID-19 Cases Rise, Airline Bookings Start to Fall

Not even the upcoming holidays – arguably the most profitable five-week window in aviation – can help the airlines.

Carriers are reporting that bookings, already down 65 percent compared to what they were in 2019 at this time, have stalled in the face of a worldwide surge of COVID-19.

That would be devastating to an industry already suffering the financial consequences of the virus since March of this year and still waiting for Congress to agree on a second stimulus package so the airlines can continue to keep flying.

But the plague continues at an even stronger pace. The U.S. set a new single-day record for positive test results on Friday with 196,000 cases

United Airlines warned Thursday that bookings have slowed and cancellations have increased in recent weeks, according to USA Today. In a regulatory filing, United said “there has been a deceleration in system bookings and an uptick in cancellations as a result of the recent spike in COVID-19 cases.”

The Chicago-based carrier added that it “does not currently expect the recovery from COVID-19 to follow a linear path and, as such, the company’s actual flown capacity may differ materially from its currently scheduled capacity,”

Translation?

Bookings are down. And they’re going to stay down.

They are also not helped by the Centers for Disease Control warning about Thanksgiving, which was, quite simply, don’t. Don’t travel.

Southwest Airlines CEO Gary Kelly said his carrier is experiencing more and more cancellations and said he was “not real optimistic that the first quarter is going to improve much from the current levels of demand. It will be winter time, and we’ve already seen seasonally the uptick in the cases, and that’s concerning.”

Ironically airline and travel stocks surged last week on the news that Pfizer has a vaccine ready to go that is 90 percent effective.