Leisure travel to overseas destinations remained low over the normally busy summer holiday season and Delta Air Lines CEO Ed Bastian said last week on CBS This Morning that the Atlanta-based airline has “seen some choppiness” in advance bookings, primarily in business travel.
“Businesses are delaying their (office) reopenings. They’re pushing them back anywhere from 60 to 120 days because of the variant,” he said.
That’s cutting into business travel since offices aren’t open to visit.
Monday’s move by the Council of the European Union to remove the U.S. from its safe list of countries for non-essential travel adds another hurdle to the recovery.
The move primarily affects unvaccinated people, since the Council recommends travel to the EU be open to vaccinated people, along with essential travelers and non-essential travelers from countries on the safe list. Monday’s decision is only a recommendation to its 27 member countries, with each country able to tailor its policies as it sees fit.
Still, Airlines for America called the EU’s recommendations “a step backwards, and clearly disappointing to the U.S. airline industry which has worked diligently to safely resume transatlantic service.”
The EU’s decision is a reversal from the its recommendation in June to lift travel restrictions from the U.S. Different European countries took different approaches, while the U.S. has continued to restrict travel from Europe. The U.S. requires that all travelers flying to the U.S., including Americans returning home, test negative for COVID-19 no more than three days before departure.
International air passenger counts remained well below pre-pandemic levels over the summer. In July 2021 compared with July 2019, U.S.-France travel was down 73%, U.S.-Italy travel was down 78% and U.S.-Germany travel was down 68%, according to Airlines for America. U.S-U.K. travel under a different set of restrictions was down 91%.
Airlines already have been cutting back on flights planned for the fall, a continuation of the uncertainty seen in the last year and a half that causes fluctuating flight schedules and long phone waits for customers whose original itineraries are disrupted.
Delta’s flight schedules for September are down 24.3% compared with pre-pandemic levels, according to Airlines for America. The only carriers operating more flights than before the pandemic are smaller, low-cost carriers Allegiant, Spirit and JetBlue.
Still, Delta’s Bastian said last week he didn’t expect the variant to have a material impact on Delta’s financial results and still expected the company to be profitable this quarter, “even with a considerable amount of our revenue still not back yet.” (At Delta the airline, Bastian often refers to delta the variant as simply “the variant.”)
While international travel is an important revenue and profit generator for airlines, it has always made up only a fraction of air travel in Atlanta, amounting to 11.4% of passenger traffic at Hartsfield-Jackson International Airport in 2019. Last month, international travel made up less than 8% of the total at the Atlanta airport. During the pandemic, much of the international traffic has been to Mexico and the Caribbean.
In a Global Business Travel Association survey of travel buyers and suppliers in August, 78% had not yet reopened international travel and 51% continued to suspend or cancel all business travel. Of those, about 80% expected the delta variant would delay the resumption of non-essential business travel. Travel for meetings, events and conferences is the most frequent type of business travel canceled or suspended due to COVID-19 variants, according to the survey.
The delta variant “has introduced a bit of a detour,” said GBTA CEO Suzanne Neufang in a written statement, adding that the pandemic “is not going away as quickly as hoped.”
Seventy-eight percent of the survey respondents said they were “concerned” or “very concerned” about the impact of the delta variant on the safety of business travel. One in three reported a decrease in bookings.
Many vaccinated travelers are less comfortable now traveling domestically and internationally due to the spread of the delta variant, according to an Aug. 18-20 survey conducted by YouGov and commissioned by The Points Guy. About 49% of vaccinated travelers said they feel less comfortable taking a domestic flight, and 53% said they feel less comfortable taking an international flight.