With regular income flowing in from frequent enterprise journey, baggage charges, and low cost seats, airways have been flying excessive final yr, wrote Byrne Hobart in Marker. However as enterprise journey got here to an absolute useless standstill and with shoppers experiencing justifiable demand shock for the higher a part of the yr, airways proceed to face an uphill battle with journey analysts and executives saying a full restoration gained’t happen till at the very least 2024. Final week, Delta reported it misplaced a whopping $5.4 billion in Q3 with income down 75% from final yr.
With no second spherical of presidency bailouts, airways have been laying off and furloughing tens of thousands of employees and placing up varied belongings for collateral, together with their worthwhile frequent flier mile applications. Hobart wrote about how loyalty reward applications — a “high-margin, high-growth enterprise” — may very well be one of many few viable sources of income on the flailing sector’s stability sheet that’s conserving them afloat proper now. However the way forward for these applications hinges on airways truly holding onto their flights and routes and never scaling them again.