Covid Restrictions are FINALLY easing up, and the demand to travel is exceeding pre-pandemic numbers… but so are the costs. Couple these Bidenflation caused issues with canceled flights and rental car shortages, and you get the American traveler in for a rough summer. Read below to see if your summer vacation is best pushed to the Holiday season.
Chris Isidore; June 1, 2022
Airlines had said they were prepared to avoid the service problems that plagued much of the industry last year. But between Friday and Monday, US airlines canceled 2,653 flights, or nearly 3% of their collective schedules, according to tracking service FlightAware. That’s more than they had canceled for the same holiday weekend the previous three years combined.
In 2019, the year before the pandemic, US airlines canceled just 1.2% of their scheduled flights, despite having 6,600 more flights on the schedule.
Experts said passengers are right to be nervous that they’ll see more of the same for the rest of the summer.
“This does not bode well for the summer travel season as we expect a repeat through the summer months as more people fly,” Helane Becker, airline analyst with Cowen, said in a note to clients Tuesday. “This was a chance for airlines to show that last summer’s delays would not be repeated this summer, and yet, it was not to be.”
The airlines have significantly fewer employees, especially pilots, than they did before the pandemic. They received $54 billion in taxpayer assistance during the height of the health crisis to prevent involuntary layoffs, but most airlines offered buyouts and early retirement packages to trim staff and save cash while air traffic ground to a near halt. But it takes years to get certification for pilots and some other airline employees.
So airlines are operating with little room for error when they’re hit with bad weather, air traffic control problems or employees calling out sick, which is what they said happened this weekend.
“More than any time in our history, the various factors currently impacting our operation — weather and air traffic control, vendor staffing, increased Covid case rates contributing to higher-than-planned unscheduled absences in some work groups — are resulting in an operation that isn’t consistently up to the standards Delta has set for the industry in recent years,” said Delta Chief Customer Experience Officer Allison Ausband in an online post.
But airline critics say management should not have been caught by surprise: They knew they didn’t have the margin for error they needed. After service problems throughout 2021, including during the end-of-year holidays, airlines should have anticipated these issues, said Capt. Dennis Tajer, spokesperson for the Allied Pilots Association, the pilots union at American Airlines.
“When you stress test the airline operation model, that’s when you see the same results,” said Tajer. With flights already booked to capacity, “one flight being canceled doesn’t just cause a cascading effect, it causes a tidal wave of problems. It’s déjà vu all over again,” Tajer added.
With planes as full as they’ve ever been, it can take more time for airlines to find passengers booked on canceled flights another seat to get to their destination, Tajer said. Call centers are also short staffed and overwhelmed by demand, especially when things go wrong as they did this weekend.
“You can wait for more hours on the phone to rebook a flight than the time the flight will take you,” he said.
Staff shortages also mean higher fares
The staffing shortage means US airlines are still not able to offer all the flights needed to meet demand. The capacity of domestic US flights in June, July and August this year is 5% below where it was in those months in 2019, according to Cirium, an aviation analytics firm.
But passengers, especially vacationers, are eager to travel again this summer. Numerous airlines reported record numbers of customers booking flights earlier for the summer this year.
“There’s a mismatch of supply and demand,” said Scott Keyes, founder of Scott’s Cheap Flight, a travel booking site. “Your hopes of getting cheap flights for the summer are slim to none.”
That combination of record demand and limited supply of seats means much higher fares. The Consumer Price Index, the government’s reading of inflation, shows fares in April were \up 33% from a year ago and up 10.6% from where they stood in April 2019.
The situation is probably worse for leisure travelers than those numbers suggest because business and international travel is not back to pre-pandemic levels. Since those passengers pay higher fares than more price-sensitive domestic travelers, going on vacation is a lot more pricey than it used to be.
And it’s not just airfares that are more expensive.
A shortage of available vehicles pushed April rental car prices up 70% compared to April 2019. Hotels and other lodging was up 20% in April from a year ago and up 10.6% from where it stood in April 2019. All those price hikes are likely to accelerate even more during the busy summer travel months.
And, of course, gasoline prices are at a record high, which could be pushing more travelers to fly rather than drive on some trips.
Experts do believe the price pressures will start to retreat come fall — but not before then.
“The huge surge in demand, I think we’ll probably exhaust that this summer,” said Hayley Berg, lead economist at Hopper, another travel booking site. “That and the normal slump in demand we see in September and October will probably mean lower fares.”
But she said it’s a good idea to book travel for the end-of-the-year holiday season if you already know your plans. The same dynamic of strong demand and less supply is likely to be repeated then.