U.S. airlines face a summer nightmare with delays and pilot shortages
Traveling this summer? Arrive much earlier — or don’t arrive at all. Over 2,800 flights were canceled during the Memorial Day weekend — a taste of the upcoming summer travel season.
What’s the big deal? U.S. airlines are struggling with many issues, including a lack of international travelers, pilots and long airport lines causing flight disruption.
With summer approaching and expectations of strong domestic travel, Cowen Analyst Helane Becker is concerned about airlines’ ability to handle demand (NPR).
- During COVID, airlines gave pilots and employees early retirement packages — and now they’re experiencing a major pilot shortage
- Per Becker, airlines are dealing with long airport lines, employees calling in sick, bad weather and air traffic control delays
International travelers wanted: In mid-May, domestic travel was within seven percentage points below their pre-COVID levels, while international travel was 14% away, per CNN.
In the U.S., foreign nationals are required to be vaccinated, and most international travelers must show a negative COVID test.
- Yesterday, the U.S. announced a new strategy to accelerate international tourism
- Their plan involves streamlining the entry process, digitizing the paper-heavy process and promoting places beyond the U.S. coastal regions
Investors: U.S. Global Jets ETF ($JETS) is down 5% this year despite a strong recovery in domestic travel. High demand is good, except when airlines can’t handle that demand.
Steep oil prices, a labor shortage and a lack of international travel recovery have kept airlines from flying back to their previous heights.