Airline stocks slide despite CEOs’ upbeat demand outlook

Airline stocks slid Wednesday as the market fell broadly amid concerns over stability of some banks and new data that showed a slowdown in consumer spending. The NYSE Arca Airline index, which includes mostly US carriers, was down about 6% Wednesday afternoon, on track for its biggest one-day percentage decline since last June. It outpaced a drop in the S&P 500. Airline executives during a JPMorgan industry conference on Tuesday said they expect strong demand — and profits — in 2023, despite higher costs, with leisure travel continuing to lead the way. Consumer appetite for air travel has surged over the past year and higher fares have boosted airlines’ bottom lines. But carriers also pointed to near-term problems like higher expenses like fuel and labor. United Airlines on Monday forecast a Q1 loss from a potential new pilot contract and weaker-than-expected demand early this year, traditionally a slow period for travel. Some executives said lucrative business travel is shifting because of more hybrid work models that allow customers to mix work trips with leisure in place of more traditional schedules.<br/>