It’s an interesting time for global aviation, primarily due to geopolitical factor that are outside of the industry’s control. A lot of this has to do with President Trump’s policies on tariffs, plus the general economic uncertainty we’ve seen.
For example, a few weeks back, Delta slashed its Q1 2025 guidance, citing a reduction in consumer confidence. We’ve also seen a dip in demand between the United States and Canada. However, up until now, airline executives have insisted that transatlantic demand is continuing to be strong. That brings up an interesting update that was provided today…
In this post:
Virgin Atlantic is seeing transatlantic demand dip
Virgin Atlantic has today published its 2024 financial results, where we’re seeing the airline report a modest profit of £20 million, which is the first time since the start of the pandemic that the airline hasn’t lost money. The SkyTeam carrier has been undergoing a transformation, in hopes of becoming sustainably profitable.
It’s good to see the airline finally turning a small profit, and it’s really a reminder of how tough the airline business is. Virgin Atlantic’s biggest market is across the Atlantic, and Virgin Atlantic essentially acts as an extension of Delta’s business, but with lower operating costs. Despite Delta being the world’s most profitable airline, that doesn’t translate to much profitability for the London-based carrier.
Speaking of transatlantic demand, Virgin Atlantic also shared some bad news. During a call discussing financial results, Oliver Byrns, Virgin Atlantic’ Chief Financial Officer, shared an update on current demand trends. According to him, Virgin Atlantic is starting to see transatlantic demand take a hit. Specifically, in the last few weeks, he claims the airline has “started to see some signals that US demand is slowing.”
There are two points that are particularly interesting:
- Demand is specifically weakening for tickets originating in the US, and not for tickets originating in the UK
- Right now, spring travel is the period where weakness is being seen, so that would be for travel in the coming weeks and months
We don’t yet know just how big the dip in demand is, but to my knowledge, Virgin Atlantic is the first major transatlantic carrier to publicly acknowledge that transatlantic demand is weakening.
Given that Delta and Virgin Atlantic have a transatlantic joint venture, it seems likely that Delta is also seeing weakening demand between the US and London, since the airlines coordinate their schedules. It’ll be interesting to see if Delta releases updated guidance for Q2 2025.
What can we make of Virgin Atlantic’s warning?
With Virgin Atlantic warning of a reduction in travel demand this spring, what can we conclude from this? Should we assume this is some Virgin Atlantic specific problem, or that Virgin Atlantic is simply the first airline to admit demand is decreasing?
In recent days, CNN’s Richard Quest has had both Air France-KLM CEO Ben Smith and Lufthansa Group CEO Carsten Spohr on his program, and both made it clear that they’re not currently seeing a dip in demand across the Atlantic.
What’s interesting, and perhaps surprising, is that Virgin Atlantic is seeing the decrease in demand with the US point of sale, and not the UK point of sale. European airline stocks slumped today following this news (among other things), so what’s actually going on here?
For now we can just mark this as “developing.” Personally, I think there are some Virgin Atlantic specific issues here, but also some bigger trends.
For one, I think peak season summer demand across the Atlantic will likely be as strong as ever, even with more uncertainty, tariffs, etc. That traffic heavily has a US point of sale, and for many Americans, a summer vacation in Europe has become a non-negotiable, which is very much a post pandemic trend.
Virgin Atlantic faces a unique challenge among European carriers, since the airline exclusively operates long haul flights, and has limited regional connectivity. So Virgin Atlantic’s demand is more reflective specifically of demand between the US and UK, than you’d find with other airlines (which essentially shuttle Americans to France, Greece, Italy, and Spain, in summer).
Of course the global situation is rapidly evolving, though my guess (and again, it’s just a guess) is that sooner rather than later, Virgin Atlantic won’t be the only long haul airline sounding the alarm. Yes, summer demand will be strong, but I think non-peak season transatlantic demand will decrease materially.
This includes both business and leisure travel with a US and European point of sale. I think we’ll see a decrease in business travel in both directions (given the lack of cooperation), and I also think some Americans will have less disposable income (due to the impact of tariffs, and the stock market not doing well), while some Europeans won’t travel to the US both due to the cost of doing so, plus to protest US policies.
I’m not saying that demand is going to collapse, but I think it will be material, and I suspect it’ll become most evident after the summer peak. I could be wrong, and a lot could change, but I’m just putting my guess on record, based on the current actions we’re seeing.
Bottom line
Virgin Atlantic has warned of weakening transatlantic demand. Specifically, the airline is seeing a reduction in demand for spring travel, with a US point of sale. While some problems are a bit UK specific (since Virgin Atlantic only operates long haul flights), I can’t imagine that this is a totally isolated problem. It’ll be worth watching to to see how this situation develops.
What do you make of Virgin Atlantic’s warning about weakening demand?
We’ve been in a white collar recession since the 2022 rate shock. The top 20% of incomes who drive travel spending are seeing a slackening job market. I’m grateful to have a job and am saving more than half my take home pay because I can’t count on easily getting a similar role.
AI has barely replaced any jobs but fear of getting automated is very real
True and a bummer.
Maybe less demand, so cheaper business class tickets? It's high time, as the pricing for C class tickets between the US and Europe has become indecent compared to a few years ago.
Lots of snarky / cynical replies here about how it’s good to have fewer Americans traveling to Europe (doubtless many by Americans who frequently travel to Europe), but the real signal / risk here is a rapid consumer demand drawdown in the US due to uncertainty. That can snowball into a global employment-killing recession quickly that can leave many of us, American and European, without an income, all while clowns are running the White House...
Lots of snarky / cynical replies here about how it’s good to have fewer Americans traveling to Europe (doubtless many by Americans who frequently travel to Europe), but the real signal / risk here is a rapid consumer demand drawdown in the US due to uncertainty. That can snowball into a global employment-killing recession quickly that can leave many of us, American and European, without an income, all while clowns are running the White House and Congress, which would hurt the chances of a decent Keynesian stimulus. Scary stuff and not something to take lightly.
Sensational news. The fewer dumb Americans coming to Europe, the better it is for all of humanity.
Stay in your own cesspool of a fascist state.
What an ignorant comment
1. 49.8%% of this country have voted for a repulsive regime.
2. 48.3% of this country did not.
3. Not everyone in category 1 is a terrible person.
4. Not everyone in category 2 is a saint.
Consider, possibly, a more nuanced and human approach.
And yet, Europeans want to study in the US learning from the ones u call dumb and paying handsomely for that. Stop associating a country with it’s leader.
@Alex
Hard to take seriously a person using "u" instead of you and It's instead of its.
We are associated with our leader, regardless of how you and I think. Just saying we are "the others" is not enough. That is, in case you haven't noticed. So either get yourself a good pair of boots and prepare for the civil war or accept your place in this country as a passive opposer while it falls....
@Alex
Hard to take seriously a person using "u" instead of you and It's instead of its.
We are associated with our leader, regardless of how you and I think. Just saying we are "the others" is not enough. That is, in case you haven't noticed. So either get yourself a good pair of boots and prepare for the civil war or accept your place in this country as a passive opposer while it falls. Better yet fight back, stop saying "U" and get some actual balls to what WE have all become because of this man.
Seen this since end of Jan
Multiple smaller group events/gatherings I was involved in - moved to Canada, UK or EU or moved entirely
Of course there will be folks here who will call it fake news.
Not everything is economics. Political instability (or the threat of political instability) has and will absolutely have an impact on people traveling to the US. Having a president who proliferates chaos, turns on longstanding allies, makes dramatic snap decisions and then suddenly claws them back (or claims to have been joking or sarcastic) adds up to instability.
Add to it a documented history of POTUS’ hypersensitivity to criticism and willingness to violate the constitutional...
Not everything is economics. Political instability (or the threat of political instability) has and will absolutely have an impact on people traveling to the US. Having a president who proliferates chaos, turns on longstanding allies, makes dramatic snap decisions and then suddenly claws them back (or claims to have been joking or sarcastic) adds up to instability.
Add to it a documented history of POTUS’ hypersensitivity to criticism and willingness to violate the constitutional rights of those he perceives to lack sufficient fealty to him, that adds up too.
This stuff is happening. Even if you decide to disagree on the merits, it’s still the perception of western allies and their citizens with disposable incomes. Perception matters.
From the article: "Demand is specifically weakening for tickets originating in the US, and not for tickets originating in the UK"
Perhaps reading the article will help your perception of this situation
It's possible to be two things at once. For instance, you've managed to be:
1. Correct
2. Smug
Perhaps being less smug might help you relate better to other humans
Additionally, while Virgin Atlantic specifically noted weakening demand from US travelers to the UK (not UK to US), this actually aligns with what's happening globally. Multiple sources show Europeans are indeed reconsidering travel to the US due to political factors:
- Tourism Economics revised their 2025 forecast from 9% growth to a 5.1% decline in US inbound travel
- Germany (-8.5%), France (-5.6%), and broader Western Europe (-3.9%) all show declining US-bound travel in...
Additionally, while Virgin Atlantic specifically noted weakening demand from US travelers to the UK (not UK to US), this actually aligns with what's happening globally. Multiple sources show Europeans are indeed reconsidering travel to the US due to political factors:
- Tourism Economics revised their 2025 forecast from 9% growth to a 5.1% decline in US inbound travel
- Germany (-8.5%), France (-5.6%), and broader Western Europe (-3.9%) all show declining US-bound travel in February 2025 vs. 2024
- Multiple European countries issued travel advisories warning citizens about potential detention at US borders
- European airline executives (Lufthansa, Air France-KLM, IAG) are monitoring the situation 'very, very closely' despite claiming summer bookings remain stable
So while Virgin Atlantic may be seeing one trend (US→UK decline), the larger picture shows Europeans are indeed hesitant about US travel due to political factors, just as the original comment suggested. Both trends can exist simultaneously.
perception,
you started out w/ a political rant and missed key facts about which you were corrected.
Demand declines from the US have nothing to do with how the world thinks or sees the US but economic uncertainty and wealth deterioration in the US
Tim - I expanded the scope of my comment beyond the more limited scope of the article and didn't make that clear the first time. So if you want to call that a correction, sure, I'll buy that. There were no other corrections other than that - and certainly no corrections of "missed key facts"
As for your last comment, while the New York Times has indicated that, "Inbound international visitor numbers were not expected...
Tim - I expanded the scope of my comment beyond the more limited scope of the article and didn't make that clear the first time. So if you want to call that a correction, sure, I'll buy that. There were no other corrections other than that - and certainly no corrections of "missed key facts"
As for your last comment, while the New York Times has indicated that, "Inbound international visitor numbers were not expected to reach 2019 levels until later this year" due to "the strength of the dollar," the same article also cited "long visa wait times" as a factor
Research firm Tourism Economics now forecasts "inbound travel to decline by 5.1%" due to "negative sentiment shift... sustained by an evolving mix of Trump administration factors."
CBS has also reported multiple European countries have issued travel advisories following detention of tourists at US borders.
I believe Perception is actually spot on in their observation. The POTUS has managed to alienate most of the world. I have a number of friends in Europe and Latin America who simply will not visit the US any longer and I do not for a moment blame them.
perception.
thank you for your response.
and adding brad,
The reality is that we cannot know why things happen unless we specifically ask people.
There was all kinds of noise here just a few days ago about a 70% drop in Canadian bookings to the US and Airlines for American just came out w/ data that says that airlines are seeing low double digit percent (that would be 10% or so) declines in...
perception.
thank you for your response.
and adding brad,
The reality is that we cannot know why things happen unless we specifically ask people.
There was all kinds of noise here just a few days ago about a 70% drop in Canadian bookings to the US and Airlines for American just came out w/ data that says that airlines are seeing low double digit percent (that would be 10% or so) declines in demand. The hysteria including on Wall Street is over the top.
Uncertainty and continual changes are causing alot of people to be careful with their spending.
If you are a US government employee or contractor, you have even more reason to be concerned.
It doesn't matter what anecdotes we hear or what a few people say. Based on the anecdotes that seem to be repeated, there should be a 70% decline - but that is simply not happening
I get why people are upset.
I don't accept the repeated statements of a collapse in travel when that is simply not what airlines are reporting.
Not a single airline so far has given any indication of weak demand beyond the 2nd quarter.
If there is a mass change in foreign travel bookings to the US or Americans are changing their travel behavior to other countries, it is not happening beyond the 2nd quarter and then only up until May according to what airlines are actually saying.
that could very well change but that is what anyone with facts is saying.
Tim - Thank you for your response as well. The data tells a clear story. Multiple official sources confirm both economic AND political factors are affecting travel simultaneously:
- Tourism Economics explicitly cites "polarizing policies and rhetoric" causing a 5.1% decline in US inbound travel ($18B loss)
- NTTO data shows February drops from Germany (-8.5%), France (-5.6%), and Western Europe (-3.9%) coinciding with European travel advisories
- The February NTTO report confirms...
Tim - Thank you for your response as well. The data tells a clear story. Multiple official sources confirm both economic AND political factors are affecting travel simultaneously:
- Tourism Economics explicitly cites "polarizing policies and rhetoric" causing a 5.1% decline in US inbound travel ($18B loss)
- NTTO data shows February drops from Germany (-8.5%), France (-5.6%), and Western Europe (-3.9%) coinciding with European travel advisories
- The February NTTO report confirms total air travel down 1.39% despite strong domestic demand
- Your own source confirms a 10% decline costing $2.1B in spending and risking 14,000 jobs
- OAG data shows US-Canada bookings down 70-75% (only 295,982 tickets for April 2025 vs. 1,218,570 in 2024) while capacity cuts are only 1.6-3.5%
These are verified statistics from government agencies and industry reports, not anecdotes or feelings.
Looks like the facts are on your side, Perception Matters.
“Everyone is entitled to his own opinion, but not to his own facts.”
― Daniel Patrick Moynihan
"""and for many Americans, a summer vacation in Europe has become a non-negotiable, which is very much a post pandemic trend."""
This is a good example of ignoring the concept of "reversion to the mean". Many trends are, in fact, temporary. It makes logical sense that there was extra trans-atlantic travel after COVID restrictions eased, as many people had to cancel or reschedule travel originally planned during those years. It's not surprising that this would...
"""and for many Americans, a summer vacation in Europe has become a non-negotiable, which is very much a post pandemic trend."""
This is a good example of ignoring the concept of "reversion to the mean". Many trends are, in fact, temporary. It makes logical sense that there was extra trans-atlantic travel after COVID restrictions eased, as many people had to cancel or reschedule travel originally planned during those years. It's not surprising that this would wear off.
I understand it may not be great for airlines, but many of these places in Europe are over crowded, and lets be honest, Americans generally aren't the most pleasant abroad anyhow (I say that as an American myself). Am I the only one who doesn't see this as a bad thing? Mass leisure travel growing year over year is likely unsustainable
Americans are far FAR from the worst tourists and usually the crowding isn't coming from the US
Yeah the American tourist bad narrative is overblown.
For example, there has been a huge influx of Chinese and Indian nationals visiting Japan and I frequently see more of them crowding or behaving poorly rather than the American tourists.
If anything, Americans abroad are more more perceptive of this narrative and are on better behavior as a result.
@betterbub and @yoloswag420 are very, very correct
the Chinese selfie sticks and failing to observe queues (among other pushy behaviors) are so annoying.
At least they’re not 3x the size of what a normal human should be
Oh, smug comments about obesity. Does the sneering condescension make your evening better, "B L"?
Might be a good time to revisit the great onsen debate.
Gradually declining value of USD to Euro would be another reason for decline in US originating leisure travel
You wouldn’t notice it from economy fares this April and May. They are pretty high compared to previous years.
Not if you're going to Canada. Those airfares and hotel rates are the lowest I have seen in decades. Vancouver hotel rates are cheaper in April /may than nov when nobody goes to Vancouver.
$475 round trip ORD-CDG three weeks in advance late April. I wouldn't can that high.
Let’s see if this trend develops over the coming months, the full effect of the US regime change is still unpredictable and difficult to absorb as the hits come hard and fast then pulled back causing market volatility. Some U.S citizens are just waiting to see how things pan out this year before burning $$$ on trips. And as others have said the VS coffin seats on the B787 and A333 older aircraft just need...
Let’s see if this trend develops over the coming months, the full effect of the US regime change is still unpredictable and difficult to absorb as the hits come hard and fast then pulled back causing market volatility. Some U.S citizens are just waiting to see how things pan out this year before burning $$$ on trips. And as others have said the VS coffin seats on the B787 and A333 older aircraft just need to go and the ridiculous price synergy with peers relying on loyalty and ground experience is flnite.
and yet VS says business demand remains strong. It is US originating last minute leisure demand that they say is declining
US stock markets and wealth is demand which is the most likely reason for a decline in discretionary income.
If the stock market doesn't stabilize by next summer, there will be a lot fewer Americans traveling abroad in the future in the fall and beyond. but this summer is likely going to be strong.
I count my travel mostly in the business camp and yes their are plenty of us but the margins are not that great, for instance our TMC normally secures 40% discounts on published J fares and ours won’t be the only ones getting those types of corporate discounts. They need more full J and W fare payers to make a real impact on the books.
Summer will be strong for U.K. origin as the weak...
I count my travel mostly in the business camp and yes their are plenty of us but the margins are not that great, for instance our TMC normally secures 40% discounts on published J fares and ours won’t be the only ones getting those types of corporate discounts. They need more full J and W fare payers to make a real impact on the books.
Summer will be strong for U.K. origin as the weak dollar makes it an ideal time to go but time will tell when we start seeing bookings for Q3+ in the coming months forecasts.
It sounds like domestically, flights to/from DC are seeing less traffic as federal employees now lack an employer-issued credit card for travel expenses. Now, if you were a DC-based federal employee and forced to fly coach (even long haul, as far as I understand for most people), wouldn't Virgin be one of your best options? If so, Virgin would be especially vulnerable to getting DOGE'ed.
One also wonders how much inbound traffic to DC will be impacted, originating both abroad and domestically, as all impacted agencies have been forced to cancel meetings, seminars, training courses, etc., so those who were planning to come to DC (US gov't employees or foreigners) have had their trips cancelled - even non-refundable trips that had already been paid for months in advance.
You're correct about flying in the back of the bus for...
One also wonders how much inbound traffic to DC will be impacted, originating both abroad and domestically, as all impacted agencies have been forced to cancel meetings, seminars, training courses, etc., so those who were planning to come to DC (US gov't employees or foreigners) have had their trips cancelled - even non-refundable trips that had already been paid for months in advance.
You're correct about flying in the back of the bus for government employees. Only the most senior members of government are allowed to book business, and even then, they have strict rules around conflicts of interest, etc. I once offered a chargé d'affaires to a European country a Systemwide upgrade on United for one of his return trips, and he adamantly refused, citing such conflict rules. All bets are off with the current corrupt administration, but that's how it used to work.
My suspicion is that all the 100's of billions of dollars of tax payer money that were given to the left leaning NGO's was funding a tremendous amount of business class and domestic first class flying by our DC grifter class.
Just pulled that one outta the place the sun don't shine, didn't ya?
Flew out of DCA to Vegas two weeks ago on an 8AM flight. Got to the airport at 7:15AM. TSA PRE was empty. I walked straight to the agent to put my DL into his machine without queuing. I have never experienced such in decades of travelling. It was a tad surreal.
if that is the norm and not just a day of week issue, then there will be significant impacts to AA, UA and WN's financials esp. since all 3 have large operations in Washington DC.
But government employees and contractors are also "regular consumers" so part of the decline in outbound tourism could be government employee related.
I wouldn't travel anywhere as a government employee without government prepay or credit card - I wouldn't want to be left holding the bill on my personal credit card.
DOGE'd - is that the new Bonvoyed?
Typically you'd have to buy on a US carrier if using a federal govt payment card for an executive branch agency...so the passenger would have to consciously choose a codeshare that resolves to a VS seat.
Europeans cancelling trips to the US "because of the cost" doesn't make sense to me. If dollar tanks, the US will be cheaper (plus if the demand goes down, so will the prices). The drop in the European demand for US trips will likely be based on safety concerns - which may not even be new, but are gaining much more attention in European media recently (various CBP power trips, people being detained for no...
Europeans cancelling trips to the US "because of the cost" doesn't make sense to me. If dollar tanks, the US will be cheaper (plus if the demand goes down, so will the prices). The drop in the European demand for US trips will likely be based on safety concerns - which may not even be new, but are gaining much more attention in European media recently (various CBP power trips, people being detained for no reason and treated like criminals during those detentions, etc).
For some reason prices in economy are going up. Are the airlines increasing fares to offset the loss of demand?
VS screwed around with redemptions rates (no, I am not burning 120,000 miles for a one way Y seat JFK-LHR), taxes, fees & 'surcharges' still sky high, cost of living through the roof, and then wonder why demand is dropping...
My heart bleeds.
"Uh oh"? You say this as if it's a bad thing. Airlines have been gouging pax the past five years with higher prices, reduced levels of service and nonstop slashing of FF benefits. LET THEM SUFFER
@BTN:
I for one am salivating. I would love to pick up a few choice morsels if and when they begin to cut prices.
Last year, I went to The Maldives for my birthday. I booked the J ticket via AA flying on QR. I was hoping to repeat trip, but price increased over $2K. I wasn't doing it. Let's see what happens now...
I was thinking this too originally, but...since RASM is already so low for the US3 and with people *not* traveling, will airlines simply raise fares to account for the lack of revenue resulting from decreased ticket sales? If so, then even fewer people will be able to travel. It becomes this self-fulfilling prophecy. I'd love if they dropped prices to bring people back, but I'm looking at a trip for work/pleasure in two weeks and...
I was thinking this too originally, but...since RASM is already so low for the US3 and with people *not* traveling, will airlines simply raise fares to account for the lack of revenue resulting from decreased ticket sales? If so, then even fewer people will be able to travel. It becomes this self-fulfilling prophecy. I'd love if they dropped prices to bring people back, but I'm looking at a trip for work/pleasure in two weeks and the price has increased by 75% since three days ago. So I'm not optimistic that prices will lower.
I’m noticing an increase in fares and a lack of award availability on all carriers across the Atlantic compared to previous years.
Well, raising fares when there is a drop in demand goes against econ 101 theory. But we'll see.
This is awesome news. Too many people chasing too few seats. Airlines screwed the pooch with all the increased labor costs and now cutting loyalty benefits. The reckoning is coming!!!!
Three reasons this is not awesome news, Matthew:
• Economic hardship for airlines leads to reduced routes, higher base fares, and more fees—not better deals for travelers
• Industry staffing cuts would worsen customer service and create operational problems
• Loyalty program benefits typically get worse, not better, when airlines face financial strain
Well, USA, play stupid games, win stupid prizes...
Your RWNJ rulers (they certainly aren't public servants) are doing a smashing job with the economy.
Of course the UK jailing people over social media posts and creating a race-based two tiered justice system is making people flock to the country.
Jailing people for organizing a mob to burn down a hotel with refugees in it should be a crime in any civilized country.
Don’t believe what your cult leader is feeding you.
We will see what happens. The US growth rate in 2024 was 2.8% and in 2023 2.9%. The US economy is cooling with Covid stimulus running out and government cut backs. What was the UK's growth rate since coming out of Covid?
You mention twice that Virgin is "seeking" a reduction in demand. Do you mean "seeing"? I do t think anybody would "seek" a reduction in demand, though it doesn't surprise me that given the situation airlines would "see" a reduction in demand.
God forbid Ben make a typo... yeeeesh.
He usually likes when people point things out so he can correct things. Hes said that before. Especially making the same mistake more than once
VA is more vulnerable than most carriers as it is very US focused with its only really other market focus leisure routes to the Carribbean. At the same time unlike Delta, generally it is more flown by British and European travellers who prefer non-US carrier to fly with, but those travellers are increasingly avoiding flying to the US. It's definitely bad times for them, but it was always a fatal error focusing on one market so much which makes them very vulnerable.
For the sake of accuracy: VA is Virgin Australia and VS is Virgin Atlantic.
Virgin has pretty much placed a sizeable portion of its eggs in the TATL market. Any hit to this will therefore produce a significant impact to its operations. It has always been the case.
I look forward to seeing how this plays out. I wish them the best as I have a soft heart for them.
feel free to back up your statements w/ actual shares of the LOCAL UK to US market - independent of connecting traffic at LHR esp. for AA and BA.
I suspect the general rule is true that foreigners tend to prefer their local airline while US airlines cater to US customers but I don't see any evidence that VS does any worse than BA or DL worse than AA or UA in the UK market....
feel free to back up your statements w/ actual shares of the LOCAL UK to US market - independent of connecting traffic at LHR esp. for AA and BA.
I suspect the general rule is true that foreigners tend to prefer their local airline while US airlines cater to US customers but I don't see any evidence that VS does any worse than BA or DL worse than AA or UA in the UK market.
and VS said that it is LAST MINUTE US leisure travel that is down - and nothing else that has been extrapolated here.
VS' network is much more heavily UK to US than any other airline.
And it is equally notable that none of the continental European airlines are saying anything about demand weakness (so far) either from the US or their home countries even though so many people are convinced there is huge pushback from foreign travelers. Even Canadian airlines are saying the magnitude of demand decline is nowhere near what some have stated.
I've always felt that transatlantic travel is much more competitive than transpacific travel. Is this true?
With the Chinese airlines no longer a major player that is definitely true.
I mean maybe people in the US got tired of flying their outdated 787 and A330ceo seats?
I will literally fly Delta to LHR simply because their seats are superior to those coffin seats.
I am otherwise surprised to see the weakening from the US given how many Indian nationals in the US there are, who fly on VS to connect to India.
Maybe theyre scared to leave incase the regime then wont let them back in?
That's a bit hyperbolic, but actually I remembered why, it has to do w/ the new UK ETA/visa rules.
Indian nationals can't use the UK ETA and instead need a proper transit visa now, which makes transiting in LHR a pain for them. And those visas are not cheap or fast.
You don't need an ETA if you remain airside and do not go through UK immigration so Indian citizens would not be the reason.
... except that VS flies A350-1000's on many of its routes to LHR
Pretty simple answer here - people are waiting to fly their preferred carrier, Global Airlines.
ROFL!
IAG stock has declined 14% since beginning of the year
AAL and JBLU are down 40%; DAL and UAL are down about 30%
LUV is one of the best performing airline stocks in the world and it is because investors believe they have a plan to turn things around.
Overall, US stock markets are down and investors are fearful that the post-covid travel boom could be over which is why airline stocks are down much more than the market as a whole.
Airline stocks however WAS enjoying a bull run from late 2024 on lower fuel prices. Now, if oil futures go up and it's looking it might then airlines will suffer. AA seems to be leading the downtrend as they have fallen from $17 to $11 which is their low range. If they don't stay above $11 they're in trouble.
VS specifically noted that corporate traffic is strong in both directions... and yet that was excluded from the article.
LHR has tipped back and forth in overcapacity for years.
if there is any accurate conclusion that can be made, it is that short-term leisure demand is softening, not that there is a summer collapse of travel in either direction.
Given the economic uncertainty around the planet, a near-term pullback in leisure demand is...
VS specifically noted that corporate traffic is strong in both directions... and yet that was excluded from the article.
LHR has tipped back and forth in overcapacity for years.
if there is any accurate conclusion that can be made, it is that short-term leisure demand is softening, not that there is a summer collapse of travel in either direction.
Given the economic uncertainty around the planet, a near-term pullback in leisure demand is likely to be seen in many markets.
Analyzing what was said and not what one wants to have been said is necessary to come to accurate conclusions
This investors are wrong, Tim
Curious to see another European airline share their trends and analytics or if this is London focused. London - forgive my French - has turned into a sh** city and full of crime and it’s just not high on Americans wish list anymore. I would be more concerned if other airlines shared the same sentiment.
Do you read the Daily Mail ? The crime rate in London is significantly lower that most US cities. It is perfectly safe walking around. There is so much going on, including the best theatre in the world.
I do not know what your source is for London crime rates. If London is not high on American's wish llsts, then logically there will be fewer Americans for me to meet while I enjoy my favourite city in the world which also translates into fewer awkward conversations with American travellers. Being a travel blog, my only concern about the UK is their high taxes on airline travellers. I have visited 42 American provinces including...
I do not know what your source is for London crime rates. If London is not high on American's wish llsts, then logically there will be fewer Americans for me to meet while I enjoy my favourite city in the world which also translates into fewer awkward conversations with American travellers. Being a travel blog, my only concern about the UK is their high taxes on airline travellers. I have visited 42 American provinces including Hawaii and Alaska and one territory, American Samoa, and I do not feel any less safe in London than in a city in one of the American cities like Seattle or Boston or Ely Nevada or San Diego or Sun Valley Idaho or Lincoln Nebraska or Provo Utah, or Maggie Valley North Carolina, all of which I have visited and enjoyed. As far as travel goes, all cities have good and bad areas to visit.
Dan - There’s no such thing as an “American province.” You clearly are lying and know nothing about the U.S. or you would have known they’re called STATES. London’s crime rate has skyrocketed. Please don’t come back to the U.S. and stay in London since you love it so much.
US point of sale, flights to London, spring time... Two things I think are going on:
1) Corporate demand has taken a bit of a pause the given all of the (self-inflicted) macro uncertainty
2) The calendar this year, with extended spring break from basically early March through late April, has been a further negative for corporate demand. It's mixed for leisure depending on where people go. Japan continues to be popular right now,...
US point of sale, flights to London, spring time... Two things I think are going on:
1) Corporate demand has taken a bit of a pause the given all of the (self-inflicted) macro uncertainty
2) The calendar this year, with extended spring break from basically early March through late April, has been a further negative for corporate demand. It's mixed for leisure depending on where people go. Japan continues to be popular right now, for example.
Leisure demand, US point of sale, will likely be strong in the summer. But in these shoulder periods, you need a ton of business demand, and that has been spotty
Ben, I would love to read a post extrapolating on this fascinating claim: "for many Americans, a summer vacation in Europe has become a non-negotiable, which is very much a post pandemic trend." Is this anecdotal? Data-driven? Thoughts on why "revenge travel" turned into a durable, "non-negotiable" consumer habit?
Hard to believe that a vacation in Europe is "non-negotiable". It's more that after the pandemic, people realized that there's no sense in putting off their dream vacations, and because employment was strong, people had the money, so they went. If/when the economy weakens and people start losing their jobs, the "non-negotiable" vacation will be the first thing to get negotiated out of existence.
@ Evan -- I'd say it's somewhere between anecdotal and data-driven. Just look at how much airline schedules have grown across the Atlantic after the pandemic. I think there are a lot of factors at play, and maybe it makes for an interesting topic in a separate post.
Why has revenge travel across the Atlantic turned out to be durable? I think several factors:
-- I think social media has changed how people behave,...
@ Evan -- I'd say it's somewhere between anecdotal and data-driven. Just look at how much airline schedules have grown across the Atlantic after the pandemic. I think there are a lot of factors at play, and maybe it makes for an interesting topic in a separate post.
Why has revenge travel across the Atlantic turned out to be durable? I think several factors:
-- I think social media has changed how people behave, and has increased the need for people to "keep up," and travel where they perceive as "cool"
-- The richest Americans have only gotten richer in recent years, and that's also why we've seen such a massive increase in luxury hotel rates, and that helps sustain the premium demand across the Atlantic
-- People increasingly work from home and have more flexibility in terms of vacationing
-- The pandemic taught a lot of people to not put off their dream trips, and to instead enjoy life as much as possible
-- Younger generations just value experiences more than previous generations, and that largely includes traveling to Europe
The anecdotal aspect of this is that I can't count the number of people I'm acquainted with who had never been to Europe before the pandemic, and now go at least once a summer, if not twice.
You're halfway to that separate post! :) I agree with everything you wrote. I am a prime example of this trend:
- Mid-career lawyer who left the stability of a large firm to open my own practice
- Read the book "Die With Zero" and altered a ton of habits as a result
- My spouse and I value experiences over things and want to instill that value in our kids
...
You're halfway to that separate post! :) I agree with everything you wrote. I am a prime example of this trend:
- Mid-career lawyer who left the stability of a large firm to open my own practice
- Read the book "Die With Zero" and altered a ton of habits as a result
- My spouse and I value experiences over things and want to instill that value in our kids
- Now that I WFH, I have much more flexibility to take longer trips, and I'm not afraid to have the kids miss a few days of school in exchange for broadening cultural horizons
- And yes, the social media algos have me figured out, which is how I get ideas for crazy trips once a week
When reality starts hitting those stock market balances, the middle to upper-middle class is going to pull back on luxuries. Well at least I hope so, as award availability has been so much harder to come by these days.
basically, instagram.
it's the new "keeping up with the jones's". if you dont take a summer vacation to europe you're a loser. dont shoot the messenger
yes ben nailed the response as i was typing
except that his comment about "the richest Americans" is because so much wealth is from the stock market and the US stock market is down.
The "richest" Americans that are traveling - those w/ significant retirement investments - are not as rich as they were at the beginning of the year. It is a given that spending will decline for them just as it has for lower income working families.
Absolutely this. The UK travel forums are full of people asking about doing day trips from London to the Cotswolds and Stonehenge, presumably just to take a photo to post on the 'Gram, as there wouldn't be any time to do anything else...
I suspect that uk travel forums are not talking about doing a day trip to the cotswolds and stonehenge lol.
Ok, this is one from today:
"Day 1 - starting at 8am: *Stonehenge (1hr) *Avebury *Railway Museum in Swindon (1hr, for the toddlers) *Arlington Row *Model Village (Bourton on the Water) *Broadway Tower (won't go up) *Chipping Campden (possibly just a drive through) *Stratford-upon-Avon (arrive after 3pm, hopefully have an hour for Anne Hathaway's Cottage) *Explore town, head to hotel"
Absolutely insane.
Not as extreme or foolish, IMO, as some of the trips I've read about on other travel blogs where people go to ridiculous lengths to earn airline status.
BuiltInYorkshire, maybe Instagram made day trips more popular, but this is hardly a new phenomenon. I took a day trip like this from London 20 years ago. And when do you think the first tour operator arranged a day trip from Florence to Tuscany for a cooking class? 1952?