Forget the hot towel... Flashback to December 2019: the travel industry is booming. Flights are so packed you can barely snag a seat to visit grandma in Rome, Georgia. Flash forward to mid-pandemic: even Rome, Italy has no takers. On April 15 last year, only 90K people passed through TSA checkpoints... 97% fewer than pre-pandemic. Now...
Goodbye, in-flight champagne... hello $5 André bottle. After Zooming-from-home for over a year, companies are asking themselves questions like: "Does Carla really need to shake hands with Frida over lobster in Singapore to make the $1M deal happen?" Many are saying "no" — and that's a big problem for airlines.
Investors aren't making pre-pandemic comparisons... Pre-corona, airlines were riding a streak of record profits. In February 2020, Delta was so profitable that it paid out $1.6B in profit-sharing bonuses to employees. Then the pandemic hit, and airlines erased years of gains with their ginormous 2020 losses. Still, Delta and American shares are only down less than 13% from late January 2020 — and Southwest stock is up 13%. Investors are seeing the cabin half-full: they're looking past the pre-pandemic norm, and focusing on the emerging recovery.