American Airlines’ CEO said ticket sales are starting to tick upwards again, despite complete uncertainty about when it will be safe to travel
American Airlines CEO Doug Parker said on Wednesday that the past week had seen a slight uptick in bookings for more than 90 days away, a possible glimmer of hope as the airline industry continues to be hammered by the coronavirus crisis.
Parker also said that corporate customers had begun reaching out about travel for the fourth quarter, something that “certainly isn’t going on in the second and third quarter.”
It remains unclear when travel will be able to resume, or when the pandemic can be contained enough to allow normal life to start to return.
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American Airlines CEO Doug Parker said that despite the scale of the coronavirus crisis for the airline industry, there’s reason to be optimistic that travel will bounce back when the disaster abates.
During an interview on CNBC’s Squawk Alley on Wednesday, Parker said that in recent days, the airline had seen an uptick in sales of tickets for travel more than 90 days in the future.
“I will say that just in the last week, we’ve started to see bookings outside of 90 days start to tick up a little bit again,” he said, noting that things could change before the actual flights. “That seems to be a little bit of an indication that maybe our country’s ready to get moving again.”
Additionally, Parker said, corporate clients are starting to look at booking flights to events and meetings towards the end of this year.
“Our sales team tells me we’re being asked to work on conventions in the fourth quarter,” he said. “That certainly isn’t going on in the second and third quarter. So there are indications that the world is ready to start traveling again.”
“But they’re very preliminary, and it’s certainly not happening today,” he added.
As the coronavirus has brought much of the world to a virtual standstill, airlines have seen revenue stop flowing almost overnight. Parker said American’s revenues were down 90% year over year.
To try and encourage sales for future travel, many airlines, including American, have implemented flexible ticketing policies. American will waive change and cancellation fees for trips booked between March 1 and May 31, 2020, for travel at a later date. Canceled tickets are good for a credit towards a later flight, rather than a refund.
It was not immediately clear whether American was offering similar flexibility to corporate accounts to try and entice sales for later in the year. Many companies are expected to cut back on travel expenses as the financial crisis leads to belt-tightening across sectors.
As Americans become increasingly restless while sheltering-in-place and social distancing, however, planning future leisure trips for the summer and fall can offer a future retreat to look forward to.
However, it’s unclear when travel will be able to resume, and whether those bookings can hold.
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