US, EU Airlines To Benefit From Biden Administration Lifting Travel Ban

President Joe Biden’s decision to reopen the country to fully vaccinated travelers from Europe should be a boon to both U.S. and international airlines.

Traditionally, trans-Atlantic routes are extraordinarily lucrative for airlines.

As Reuters News Service reported, those routes accounted for 26 percent of the revenue for IAG – owner of British Airways and Iberia Airlines – in 2019 before the pandemic hit. German national carrier Lufthansa made 24 percent of its revenues from overseas flights and Air France/KLM earned 16 percent.

Domestically, American, Delta and United – the three primary trans-Atlantic carriers from the U.S. – earned between 11 and 17 percent of its passenger revenues from trans-Atlantic flights in 2019.

The U.S.-based carriers were helped financially by an extraordinary spring and summer in which pent-up demand fueled a recovery in air travel.

“The transatlantic market is a key profit generator for the main European legacy airline groups,” said Bernstein analyst Daniel Roeska.

Over the course of Monday and today, Tuesday, Sept 21, investors were even buoyed by the White House’s announcement. Shares in IAG rose 15 percent over two days and Air France was up three percent on Tuesday.

While the delta variant strain of the COVID-19 pandemic is still lurking and making its presence known in the U.S., and while winter is a fairly lean period for air travel save for the five weeks or so from Thanksgiving through New Year’s, airlines are still optimistic that Biden’s decision could be a breakthrough.

United Airlines CEO Scott Kirby said he believes a full travel rebound will happen in January.

“It appears that we’ve peaked in cases. Let’s hope that that’s the case,” he said on the CBS program ‘Face The Nation.’ “Let’s hope that as we continue to get more people vaccinated, we really can get back to normal across the country. But the demand (for) recovery has, really, probably been pushed back to January.”

British Airways said that its customers were keen to fly again, citing an increase of nearly 700% in searches for holidays to U.S. destinations like New York, Orlando, Las Vegas and Miami on its website on Monday, versus the same day last week.

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