US airlines thrown a curveball as consumer habits change post-pandemic

Shifting travel patterns by consumers in a post-pandemic world are forcing airlines to guess at what is the "new normal" as they seek to adjust by cutting flights, revamping networks and packing even more passengers into planes. Even as the thirst for travel remains strong, the changing trends are driving up airlines' operating costs and hurting revenue. They are also fueling worries about the strength of travel spending amid growing economic uncertainty, leading to a 6% drop in airline shares from their highs in January. "Today's flexible work conditions are helping to drive changes in ticket-purchasing patterns." Citi analyst Stephen Trent said. "Let's get used to it." No-show rates have gone up as customers are changing their travel plans more frequently than before. Travel demand has also softened on days in the middle of the week, but has strengthened on peak days. A Reuters analysis of US TSA data shows passenger traffic this year on average has fallen 14% on Tuesdays and Wednesdays compared with Mondays, and then it rebounds on Thursdays. Similarly, customers are booking trips well in advance compared with last year, leading to a moderation in ticket sales close to the date of travel. Citi's data shows that these so-called close-in ticket sales have moderated for a third straight week, but those for trips in June and July have improved. Those evolving patterns have forced companies to adjust. Frontier Airlines decided to slash flights on Tuesdays and Wednesdays by about 20%, citing weak demand. It marks a shift from last year when some airlines said midweek was less of a trough. The Denver-based carrier attributed the change to flexible work arrangements, where more people are spending two to three days a week working in the office.<br/>