US airlines are expecting an uptick in business over the Thanksgiving travel period, although passenger volumes are still likely to fall short of 2019 levels as some consumers weigh Covid-19 concerns and high prices.
Delta Air Lines expects to fly 5.6mn passengers between 19 November and 30 November, and has increased staffing levels to accommodate a growing flight plan, the US carrier said in a holiday travel outlook this week. Those totals would mark a nearly threefold increase over a pandemic-challenged 2020 Thanksgivingholiday season in which Delta flew 2.2mn passengers, but would still fall about 11pc shy of the 6.3mn passengers it flew in 2019.
Aside from health concerns, higher ticket prices spurred by costly jet fuel could play a role in tempering jet demand. US jet fuel prices rallied during October to the highest in seven years amid tight supplies and rising exports. US Gulf coast jet fuel prices last month peaked at 235.36¢/USG, the highest since November 2014. Prices in consumption hubs have stayed strong this month despite dipping slightly from October: midpoint assessments for prompt Buckeye jet in the US Atlantic coast have averaged 231.612¢/USG thus far in November, which would mark the highest average for the month since 2014.
November jet prices have been supported by demand relatively close to pre-pandemic levels: implied national jet fuel demand — as measured by product supplied — averaged 1.528mn b/d during the four weeks ended 12 November, down by 13.3pc from the same four-week period in 2019.
Those higher fuel costs are likely contributing to higher ticket prices, especially for international routes, according to research from US travel platform Hopper. Domestic airfare for the Christmas holiday is expected at around $390 round-trip, at par with prices paid in 2019 and up 55pc from last year's season. Outbound international air travel is expected to cost around $880 per round-trip in December 2021, in line with prices paid in the same month in 2019.
For the time being, excitement over renewed opportunities to travel internationally may outweigh cost concerns. Delta's international point-of-sale bookings increased some 450pc in the six-week period following the US government's announcement that it would reopen its borders to would-be tourists from 33 countries from 8 November, setting the stage for a potential air travel revival for US carriers in 2022.
Road trip resilience
While US air travel numbers might stay safely below pre-pandemic levels this Thanksgiving, there are signs that overall travel demand during the holiday season through December could meet or exceed levels seen two years ago.
An October survey from professional services firm PwC found that 52pc of Americans plan to travel across the Thanksgiving and Christmas holiday season, compared to 35pc of respondents in 2019. Some 72pc of travelers plan to drive as their primary mode of transport this year, the survey found, as concerns over Covid-19 continue to steer some travelers away from tight airplane cabins and crowded airport queues.
