BUSINESS

Airline ticket sales exceed 2019 milestone for the first time

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Airline ticket sales exceed 2019 milestone for the first time

Industry analysts said US airlines could try to cover up fuel price hikes by increasing fares, a process that could take months, but carriers are usually limited in how much they can pass on to customers. And the rebound is being led by leisure travelers, who are more sensitive to ticket prices than corporate travelers, airlines have to tread with caution.

Other options include cutting flights that are barely profitable or bucking plans to restore flights.

“In general, growth may slow down, or, as in the present case, the capacity that airlines bring back will not return if the pandemic continues,” wrote Helen Baker, an airline analyst at investment bank Cowen. Recent research notes.

Also, with some consumers facing higher prices for goods and services, there may not be much left to spend on holidays, experts said. And while some budget carriers may target those passengers, there’s no guarantee airlines will cut fares across the board, especially when faced with huge debt accrued during the pandemic and under pressure from shareholders. Be eager to see profits, said Henry Hartvelt, a travel industry analyst and president of Atmosphere Research Group.

“Airline CEOs aren’t in a lenient position these days, and neither are their CFOs, so I’m not expecting airlines to discount seats as we would have seen otherwise,” he said. “I think there’s a lot of pressure on airlines to keep their airfares as high as they can.”

Experts said that depending on how Russia’s war on Ukraine plays out, airlines may not see the rebound in lucrative trans-Atlantic travel they had hoped for. But domestic and short-distance international travel has and will continue to lead the recovery. And despite the obstacles getting in the way of the industry, analysts and airlines are preparing for a strong summer season.

“What we’ll end up with is home heat that looks great as opposed to great,” said Mr. Engel.

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