American Airlines announced Wednesday that it expects to fly at more than 90% of pre-pandemic seat capacity on domestic flights this summer, but travel analyst and Boyd Group International President Mike Boyd is skeptical that the industry will ever fully rebound.
"Let’s not get too excited about this" Boyd warned "FOX Business Tonight" Wednesday.
"Remember, American Airlines, great airline, but the quarter that just ended, they were down 62% from the year before. Alaska Airlines in March was down 38%. We’re not going to get back to 2019 levels for some time."
As coronavirus vaccines become accessible and air travel demand increases, American Airlines said Wednesday it would operate 150 new routes, including eight to Orlando beginning June 5. However, the airline added that seating capacity on international flights will be 80% of what it was in 2019.
UNITED TO RESUME PRE-PANDEMIC BOARDING PROCESS
However, according to Boyd, the airline's updated strategy might be wishful thinking.
"Our forecasts show very clearly that this year will be about 620 million in plane passengers," Boyd said. "That’s double what it was last year, but still down about 33% from what it was in 2019. We’ve got a long way to go."
Boyd emphasized that even if leisure travel fully recovers, many companies have found alternatives to business travel during the pandemic.
"It’s really gone into high gear here, where people have found out you can do the legal deposition by electronic means, you can take the meetings by electronic means," he said. "And as a result of that … we won’t be traveling as much as we used to for business meetings. "
The Centers for Disease and Control and Prevention (CDC) recently issued new guidance, saying that people who are fully vaccinated against COVID-19 can travel safely with continued mask-wearing, social distancing and hand washing, a good sign for the travel industry as it continues to bounce back from pandemic-fueled revenue losses.
Airline stocks took a tumble on Tuesday, however, after the FDA called for a pause in distribution of Johnson & Johnson's coronavirus vaccine.