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Airlines Creeping Back, But It’s a Long Haul

February 8, 2021

Many people travelled over the holiday period, prompting a rebound in U.S. air traffic.

Looking at Transportation Security Administration (TSA) checkpoint crossings on a year-over-year basis, after initially dropping by more than 90 percent during the spring, traffic rebounded. In fact, the decline in passengers incrementally improved to where checkpoint crossings were down only about 70 percent in the summer.

Prior to last Thanksgiving, the day with the lowest year-over-year drop in travelers was September 4, 2020, the Friday of Labor Day weekend, when checkpoint data registered a decline of 56 percent. But since December 18, 2020, and through January 2021, TSA traffic has been down less than 60 percent most of the time. On December 23, 2020, TSA checkpoint totals registered their lowest decline since March 14, with a drop of 39 percent.

All in all, the recent past has been the best period for the airlines since the pandemic started. However, despite the uptick in activity, a new report estimates the pandemic drove passenger traffic down to 1999 levels, wiping out more than 20 years of aviation growth.

On top of that, even if the high levels of activity from the holidays were to persist, which is unlikely, several airlines would still be in hot water. Halved capacity reductions aren’t enough to cover the high fixed costs of these companies.

The situation becomes worse because lucrative international long-haul flights are still lagging the recovery. Plus, the last-minute premium-priced and profitable business travel segments are still dormant. In all, more than 40 airlines decreased or suspended operations in 2020 and experts expect more to join that list in 2021.

It’s getting better, but airlines are still in trouble.

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