Executives from Delta Air Lines have reported a “modest improvement” in corporate travel demand and predicted that business travel will continue on an upward trajectory.
Despite this, business travel volumes still remain just a fraction of pre-pandemic figures.
The airline reported US$3.1 billion in operating revenue for the third quarter of 2020, down 76 per cent when compared with the same period of 2019.
Yet, the figure is steadily improving. In its second-quarter results, the carrier saw just 10 per cent of its 2019 revenue.
According to Delta CEO Ed Bastian, the carrier is projecting revenue to continue to rise, hitting about a third of 2019 levels by the fourth quarter.
Bastian noted the importance of a recovery in business travel demand in order to see a “meaningful step up” in overall travel demand.
The easing of travel restrictions and quarantine requirements will also see improved travel demand figures, according to the CEO.
For Delta, third-quarter corporate travel volumes were at about 15 per cent of the same period in 2019, however Delta president Glen Hauenstein said the numbers were “trending up across all industries”, and is expected to continue to do so into 2021.
Bastian said that similar figures were reported last week by Southwest Airlines.
The chief executive said about 90 per cent of Delta’s primary corporate customers are currently engaging in some staff travel, however in much smaller numbers than pre-COVID.
Bastian said returning corporate travellers can rest easy knowing the current protocols in place to protect public health and safety.
“With over 1 billion air travellers worldwide in 2020, there have only been 44 documented cases of suspected COVID transmission onboard an aircraft, and virtually all of them were in the early months of the pandemic before masks and revised safety protocols came into existence,” he said, citing data from the International Air Transport Association.
“We carry at Delta over 1 million people a week and have had no documented transmission onboard any of our aircraft.”
Bastian also said that as demand improved, Delta will revoke its policy of blocking middle seats. He said he had “no doubt” that the policy would be lifted within the first half of 2021.
Overall, Delta reported a net loss of US$5.4 billion for the quarter, compared with net profit of US$1.5 billion in the third quarter of 2019.
Cash burn for the quarter averaged about US$24 million per day and US$18 million per day for the month of September.
By the end of the year, the airline should have reigned in its cash burn to around US$10 million to $12 million per day, according to CFO Paul Jacobson.