Delta Air Lines Demand and Fares Continue to Rise

Dec 16, 2021 By MarketDepth

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Delta Air Lines (NYSE: DAL) said Thursday that it expects travel demand as well as fares to rise during the fourth quarter. The positive forecast comes despite the new omicron covid strain and the fact that the airline plans to post a pretax profit of approximately USD200 Million for the last three months of the year. Ultimately, Delta no longer expects to lose money within the last quarter of 2021 as travel demand increases.

Under 2019 Numbers

The carrier’s fourth-quarter revenue is expected to come in 26% under 2019 metrics, according to a securities filing published before its first in-person investor day since the pandemic. The AAA foresees that over 109 million people will travel a minimum of 50 miles during the holiday season between December 23 and January 2. Furthermore, AAA expects airlines to experience a 184% increase in comparison to the previous year.

Airlines Struggling

Nevertheless, airlines are struggling with issues affecting employers nationwide such as labor shortages and othe pandemic related problems. Consequently, these hurdles could increase ticket prices and impact available flights.  

Plans for 2022

The company’s executives are set to detail how it plans to boost profits in 2022 and top pre-pandemic levels by 2024, according to the filing. Delta shares rose 1% in early morning trading.

Strong Holiday Demand

Other airlines have also reported strong holiday travel demand, in spite of Omicron. United Airlines revealed that it anticipated to fly more people on Christmas and New Year’s than Thanksgiving.

Staff Required to be Vaccinated

According to Delta CEO Ed Bastian, 97% of its 80,000 employees are vaccinated. Due to the fact that the carrier is a federal contractor, it’s staff is required to be fully vaccinated  by January 4 with the exemption of medical or religious beliefs.