Unlock the White House Watch newsletter for free
Your guide to what Trump’s second term means for Washington, business and the world
Leading US airlines are shrugging off the impact of winter storms and the war in Iran, as demand from deep-pocketed passengers surges back following a slump induced by President Donald Trump’s policies last year.
Top executives at Delta Air Lines, United Airlines and American Airlines told a JPMorgan industrials conference on Tuesday that they each expected to post a $400mn hit to first-quarter profits after the price of jet fuel almost doubled following the closure of the Strait of Hormuz this month.
But they also noted a surge in passenger demand over the same period.
United chief executive Scott Kirby said the first 10 weeks of 2026 were all in the top 10 weeks for bookings in the airline’s history. Meanwhile, five of Delta’s top 10 highest-ever grossing days were recorded since US and Israeli attacks on Iran began at the end of February, with sales up 25 per cent last week on the same week last year.
Joe Esposito, Delta chief commercial officer, said passengers who had shied away from flying in the spring of last year, when consumer confidence was low in anticipation of Trump’s aggressive tariff and immigration policies, appeared determined to make up for lost time.
“Last March was probably the worst month we could have had, spring break, booking for transatlantic [travel], we saw all of that stall right around this time last year. I think it’s just people have lost that trip last year and we see incredibly strong demand right now.”
He added that Delta’s premium passengers, which account for 90 per cent of its revenues, had been unperturbed by price rises in recent weeks in response to the Iran conflict.
“We serve the top end of the K[-shaped economy], and probably the highest end of that K,” Esposito said, referring to the divergence between lower-income and wealthy consumers. “That’s a group that wants to continue to invest and is candidly a bit immune to what goes on with geopolitical events.”
Delta chief executive Ed Bastian added that even if the airline did not sell any more tickets for business passengers until the end of the month, this March would still mark a post-Covid record for business travel.
“Every single industry we track is up double digits,” he said. “Financial services, aerospace and defence, media, technology are up 20 per cent.”
Bastian added that lower-cost carriers with slimmer margins and more price-sensitive customers faced a more difficult challenge.
He also noted that despite promising signs of a resurgence in transatlantic air travel this summer, the carrier had seen a very “modest decline” in journeys originating in Europe since the war started. That suggests that US consumers are more keen on travelling to Europe than vice versa.
Robert Isom, chief executive of American, said the company was increasing its guidance for first-quarter revenue growth to more than 10 per cent, despite an expected $400mn hit from higher jet fuel costs.
“That’s a record year on year for us,” said Isom, noting the boom in demand translated to more than $1.3bn in revenue in the first quarter this year compared with the same quarter last year. “Eight of our top 10 days of revenue bookings, eight of our top 10 revenue weeks in our company history have been in this quarter.”
He added that American was benefiting from its investment in attracting wealthier customers, including through its loyalty scheme and credit card partnership with Citi, and by building more exclusive lounges and offering Lavazza coffee and champagne to premium passengers.
Dan Akins, an aviation economist with Flightpath Economics, said airlines were benefiting in part from customers pulling forward bookings in anticipation of more aggressive price rises to come.
But he argued that airline executives were underselling the medium-term impact of the Iran-related energy crisis on their business, warning that a partial US government shutdown that has left airport workers without pay since last week could also weigh heavily on demand, either through longer waiting times or possible security breaches.
“I have security concerns if the person that’s inspecting the contents of a passenger’s bags and their person is not able to pay rent, can’t eat and hasn’t slept in two days,” said Akins.
He added that “if you would gather the same airline executives after the second quarter, there’s going to be a lot less bravado and a lot more humble forecasting, that the impact of the fuel rise prices and the airport worker issue was deeper and more expensive than we thought”.
Credit: Source link
