pangolin

Actually you ARE - YOY virtually a stand still - and it's DOWN for the level off vs last year. It's not discouraging is the best I can say about it.

AirlineAnalyst

The normalization of air travel is continuing every day.

Here is some data.

For the Thursday - Wednesday period surrounding Independence Day, there was an average of 672,339 passengers per day. This period also historically captures 3 of the top 10 travel days of the year.

For the Thursday - Wednesday period surrounding Labor Day, there was an average of 779,564 passengers per day. This period historically has 0 of the top 10 travel days of the year.

What this means is that even though the July 4th weekend (and surrounding days) has 3 of the 10 busiest travel days of the year, Labor Day weekend (and surrounding days) blew it out of the water.

The hypothesis I have seen is that some travel was pushed to later in the year (Labor Day) and we will now stagnate and go negative for week-over-week growth in September, October, & November. That is a possibility. Right now, the data is not showing that.

I understand the forward guidance provided by CEOs but I really don't have any way to quantify that with the data I have.


Cheers,
AirlineAnalyst

senecacaptain

summer is over

Elismcpikle

what’s with the caps..? Are you yelling at your screen?

AirlineAnalyst

Yes - summer is over. The underlying driver and trend can not be called dead with the data we have now...



Both Independence Day and Labor Day constituted "Summer". There was a growth of passengers during that period when the Summer variable = 1 for both weekends. This means growth throughout the Summer period when the variable was always "switched on".

For the post-Summer period, when the variable = 0, it is not a unreasonable assumption to make that growth will continue on a % basis even if the absolute number of passengers decreases in September

Especially, (as seen from my prior comment) as the %s (and absolute # of passengers!) were higher in Labor Day than Independence Day which does not match the historical data.

That is to say that while historically Summer was expected to trend down from July to August to September, we have seen the reverse. September (thus far) has been better than August which has been better than July.

Soxfan1

If one were to group 2019 numbers into 3 categories, leisure, business and international (any reason), one would be safe in saying all summer that the two latter ones were in single digits for yoy% this summer right? So let’s say the overwhelmingly majority of the 500,000-965,000 pax per day this year this summer were leisure. I think we all agree so far.

I don’t think we hit more then 66% of our 2019 Straight up leisure numbers this summer, so as we go into the fall, there is room for the leisure bucket to continue to return to It’s normal 100%, and it could be growing back at a rate equal to (what I think) or greater than (as others think) the drop off the business bucket already has, since that bucket was virtually empty to start with.

I think what I’m trying to say poorly is that we didn’t max out on leisure yet, and are not yet at a typical fall in straight leisure anyway, so wile the business travel bucket and international bucket will be empty - the normal small bucket of leisure hasn’t maxed out yet and can keep growing to 100% of typical fall and make up for the loss of the other and hold the line at 30-35% Overall till the holidays.

I also think with pent up demand, low ticket prices, falling nationwide Covid cases, work at home, school online - there maybe more trips to visit family and friends and traditional vacation then most falls, and that could help drive the return of suppressed fall leisure up more

Duffman

That's really interesting actually. Seems the return in demand is so related to people's confidence in pandemic air travel that the usual market drivers aren't even having an effect. If that's the case, then airline recovery is directly tied to an effective vaccine, so it looks like demand will roar back heavily next Spring (assuming the vaccines work), with big jumps probable when business travel and international travel resume. Long term, if WFH continues, I'd imagine that'd really help air travel. Why spend your February in sleet blowing sideways in Chicago when you can work from a beach house for a few weeks?

Seneca Pilot

I am largely with you on this. So many people posting here seem to be afraid that work from home will kill business travel but I think it is actually quite possible that it raises overall travel. People will be free to spend time anywhere there is a quality internet connection so they just may be popping around from place to place and therefore flying more to go to the office and visit friends and relatives.

AirlineAnalyst

In a typical month, International Travel accounts for 11-13% of the total passengers.

Likewise, Business Travel is a comparable 10-14% of the total passengers.

Taking the midpoint of the above two - 76% of all travel is domestic non-business.



International travel is down to 2.99% of the total passengers for the post-lockdown period.

Business Travel is unknown for this period but it is reasonable to estimate as being down to ~5% (from 10-14%) of the total passengers. (If anyone has data here - please share)


That indicates that 92% of our current passengers are for domestic non-business.

That means that approximately 39% of the domestic non-business passengers have returned.

Quite a long runway remains...

Cheers,
AirlineAnalyst

usmc-sgt

While one man does not make a statistic:

Buddy is a VP of finance at a major corporation. His job requires monthly travel and frequently abroad. He hadn’t traveled since March and has been working from home since then, and continues to do so. Last week and this week he has flown domestically for work.

Its not much, but he’s not alone. His company has reached a point where they feel comfortable, and find it necessary for one of their VPs to travel.