CNN

People are flying again … sort of

May 19, 2020, 12:30 PM
flying again...
A Boeing 737 (737-700) jetliner, belonging to low-cost carrier Southwest Airlines, lands at McCarran International Airport in Las Vegas, Nv., on Feb. 23, 2020. (Larry MacDougal via AP)
(Larry MacDougal via AP)

(CNN) — For the first time in weeks, Americans are booking more flights than they’re canceling, and US airlines are adding flights to their schedules.

Southwest, Delta and United Airlines all said Tuesday they are pulling back on the deep cuts in their current schedules because of improved bookings.

It’s only a modest improvement, but any good news is welcome in the airline industry, which needed a $25 billion bailout to keep operating. After weeks of essentially zero demand for US air travel, even a small improvement in passenger demand, bookings, and trip cancellations is a step in the right direction.

Southwest

Southwest said the number of flight bookings outpaced cancellations in May. There were far more cancellations than bookimgs for most of March and April.

The carrier hasn’t changed its guidance for how many flights it expects to have this month, as Southwest still forecasts that its schedule will reduced by 60% to 70% from last year’s schedule for the May. But it raised its forecast for June: It said it now expects to have only a 45% to 55% reduction in capacity in the month compared to a year ago.

The picture at Southwest still isn’t rosy. It said it expects its revenue to drop to between 85% to 90% in May compared to a year ago. The airline predicts it will sell only 25% to 30% of seats on its greatly reduced schedule of flights this month.

As bad as that is, it’s an improvement from its earlier forecast of a 90% to 95% drop in revenue, when Southwest expected to sell just 5% to 10% of its flights. And the carrier expects June revenue to be down 80% to 85%, selling about 30% to 45% of seats. It cautioned that the environment remains uncertain.

Southwest, the nation’s fourth largest airline behind American, Delta and United, said its final numbers for April show a revenue drop of 90% to 95%, and that it sold only 8% of its seats.

Delta

Delta also reported that its bookings have improved, with new ones outpacing passenger cancellations on “some days” so far in May, said CFO Paul Jacobson in an presentation to investors Tuesday.

“We have seen a little bit of a bounce off the bottom. My caution is not to draw too many conclusions. But there are reasons to be encouraged,” he said. Delta is being careful to make sure the improved bookings turn into actual tickets, he added, and that they are not canceled as passengers’ dates of travel gets closer.

Delta has added about 100 flights a day to its schedule through June, Jacobson said. That allows Delta to leave 50% of first class seats and 40% of economy seats open on flights, to allow for social distancing between passengers.

Although the overall percentage of seats filled is only a faction of those limits, the higher demand on some routes requires more flights to avoid going those caps, he said.

“Credibility matters. We’ve got to keep those promises [on social distancing],” Jacobson said. “People have to get comfortable. What we’re trying to do is remove as much uncertainty as we can. All of this is to raise the [passengers’] level of confidence.”

United

United also said customer cancellation rates fell, and it expects demand for both domestic flights and certain international destinations to improve for the remainder of the second quarter of 2020. United expects its scheduled capacity for July 2020 to be down about 75% compared to a year ago. But that’s an improvement from the 90% reduction in its May and June schedules.

Still, United warned that it “plans to continue to proactively evaluate and cancel flights on a rolling 60-day basis until it sees signs of a recovery in demand.”

A slow return

US airlines reported losses of more than $2 billion in the first three months of the year, and that occurred even though the industry didn’t see the fall off in traffic until early March. Much larger losses are forecast for the second quarter.

But as more of the nation reopens for business, the number of passengers passing through TSA checkpoints at US airports is also showing signs of improvements. The traffic Monday at 9.3% of the traffic during the third Monday of May last year. That’s far better than the low point of 3.6% of year-earlier traffic through the checkpoints on April 16.

Southwest CEO Gary Kelly has repeatedly said that he expected air travel would start to come back when the country started to reopen. But he said he didn’t know how much, and how fast, such a return in demand would take place.

JetBlue Airways also told investors on a recent call that it believes the low point in air travel demand was reached in mid-April, although its executives also warned the recovery would be slow.

The-CNN-Wire
™ & © 2020 Cable News Network, Inc., a WarnerMedia Company. All rights reserved.

Today’s Top Stories

CNN

Justice Stephen Breyer and President Joe Biden....
Ariane de Vogue, CNN Supreme Court Reporter

Breyer makes it official: He’s leaving the Supreme Court on Thursday at noon

In a letter to President Joe Biden, Breyer said it had been his "great honor" to participate as a judge in the "effort to maintain our Constitution and the Rule of Law."
12 hours ago
Image of the new summer treat: Ketchup-flavored popsicles (Photo courtesy of French's)...
Zoe Sottile, CNN

The newest, weirdest summer treat is a ketchup-flavored popsicle

A Canadian ketchup brand has launched an unusual twist on a popular summer treat: Ketchup-flavored popsicles.
3 days ago
...
Tim Lister, Julia Kesaieva, Salma Abdelaziz, Pierre Bairin and Jeevan Ravindran, CNN

Russian missiles hit Kyiv as G7 summit begins in Europe

G7 summit begins in Germany, as Russia hits Kyiv with a series of missile attacks.
4 days ago
American Airlines planes sit at gates at Ronald Reagan Washington National Airport (DCA) in Arlingt...
Chuck Johnston, CNN

More than 700 flights canceled Sunday

Across the United States on Sunday, more than 700 flights were canceled, according to the website FlightAware.
4 days ago
President Joe Biden. He will visit Israel and Saudi Arabia in July....
Donald Judd, CNN

Biden signs bipartisan gun safety bill into law: ‘God willing, it’s going to save a lot of lives’

President Biden on Saturday signed into law the first major federal gun safety legislation passed in decades, marking a significant bipartisan breakthrough.
5 days ago
Bodycam footage from the Moab Police Department that shows them talking with Brian Laundrie is seen...
Jamiel Lynch and Chenelle Woody, CNN

Lawyer releases pages from Brian Laundrie’s notebook in which he admits to killing Gabby Petito

Eight pages of Brian Laundrie's notebook were released Friday by the Laundrie family attorney. The notebook was found near Brian Laundrie's remains.
6 days ago

Sponsored Articles

Tax Harassment...
Jordan Wilcox

The best strategies for dealing with IRS tax harassment | You have options!

Learn how to deal with IRS tax harassment. This guide will teach you how to stop IRS phone calls and letters, and how to handle an IRS audit.
spend a day at Bear Lake...
Bear Lake Convention and Visitors Bureau

You’ll love spending the day at Bear Lake | How to spend a day at Bear Lake

Bear Lake is a place that needs to be experienced. Spend a day at Bear Lake.
Curb Appeal...
Price's Guaranteed Doors

How to have the best of both worlds for your house | Home security and curb appeal

Protect your home and improve its curb appeal with the latest security solutions like beautiful garage doors and increased security systems.
Prescription opioids can be disposed of during National Prescription Take Back Day...
Know Your Script

Prescription opioid misuse | How to protect your family from the opioid epidemic

Studies have shown that prescription opioid misuse has increased since COVID-19. So what do you need to know about these opioids?
Follow @ikeyospe...

Tax Tuesday: The Most Common Mistakes People Make When Filing Their Taxes

Fortunately, for most average earners, they will not end up owing overpayments received for the Child Tax Credit in 2021.
Follow @ikeyospe...

Tax Tuesday: How will last year’s child tax credits affect you?

Fortunately, for most average earners, they will not end up owing overpayments received for the Child Tax Credit in 2021.