The CE of Delta warned Tuesday that the airline’s recovery in the crucial business market was likely to take at least two years as the carrier’s corporate revenues plunged. The airline’s business revenues dropped 86% in Q3, while leisure passenger sales fell 82% as it burnt through more than $20m of cash a day in a pandemic savaged market. Ed Bastian said corporate travel, which provides half of its revenues, was likely to still trail behind 2019 levels by at least 20% in two years’ time. “It will take up to two years before we fully see where business travel is going to be [at] a sustained level of demand,” Bastian said. “I don’t expect it to be 100 per cent back to 2019 levels, but . . . hopefully 75-80% of it.” While some corporate travellers are slowly returning to the skies, the recovery is threatened by executives’ and managers’ growing comfort with digital conferencing. Paul Jacobson, Delta’s CFO, said Tuesday that the airline was working with airport authorities in the US and internationally, as well as the US CDC, on pilot programmes to open international travel lanes, noting that “testing will be an important ingredient in getting there”. Delta booked a $6.9b pre-tax loss in Q3, compared with $1.9b in pre-tax income a year earlier. Operating revenue fell 76% to $3b. The company reported an adjusted loss per share of $3.30, slightly more than the $3 consensus among analysts polled by FactSet. The company’s cash burn averaged $24m a day for the three months to the end of September. At the start of the pandemic the airline had hoped to reach zero by the end of the year, which Bastian called “a pretty lofty goal without any real knowledge of how the virus would be contained”. He said Delta will now reach $10m a day in December and zero by spring next year.<br/>
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The summer travel season was even worse than expected for Delta, which said Tuesday that it lost $5.4b in Q3 as people hunkered down at home during the pandemic. Delta officials pushed back their timetable for breaking even, from year-end to next spring, as their previous expectation that COVID-19 would be contained proved too rosy. The airline's shares fell almost 3% on Tuesday. However, Delta's executives said passengers are starting to return and bookings for Thanksgiving and Christmas are looking up. “It's slow, but it's steady — week by week, they are coming back,” CEO Ed Bastian said of passengers. Bastian said Delta plans to stop blocking middle seats in the first half of next year. That would reverse a policy that Delta has used to distinguish itself during the pandemic from its closest peers, American Airlines and United Airlines, who do not block seats. The number of people screened at US airports is down 65% this month, compared with last October, but that's better than the 68% decline in September, the 71% drop in August and the 96% plunge in mid-April. Most of the people flying now are low-fare leisure travellers. Bastian said business travel is down 85% but that most corporate customers are putting at least a few employees back in the air. Bastian said video technology might replace some trips, and there could be a 10% to 20% drop "in the next couple of years when we get to that new normal of business travel.” Some analysts found that troubling. “Business travel was 50% of their revenue at one point,” said Peter McNally, an analyst at Third Bridge Group in New York. “It’s a market that Delta has made the core of their business, so they will be forced to compete harder on the leisure side of the market to make up for that loss.”<br/>
Vietnam Airlines has warned of a consolidated loss of D10.8t ($464m) in the first nine months of 2020, as the coronavirus pandemic takes its toll on operations. The company adds that it expects consolidated revenues of D23.9t for the first nine months of the year, a quarter of the D77.7t revenue generated in the first nine months of 2019. The consolidated loss represents a massive swing from the consolidated pre-tax profit of D3.3t the airline generated during the first nine months of 2019. The consolidated figure includes the mainline carrier as well as unites such Pacific Airlines, VASCO, and affiliate Cambodia Angkor Air. The carrier lists a number of actions that it has taken to deal with the crisis, which includes cutting costs, extending payment schedules, reducing non-urgent investments, operating charter flights to repatriate citizens, restructuring its organisation, operating cargo flights, and disposing of older aircraft. The airline is operating 60 domestic routes with an average of 300 flights daily. Passenger volumes are 12% higher than a year ago.<br/>