Travel business starts to rebound
The nation’s largest airlines are preparing for a limited rebound next month as more Americans book vacations in places like Florida and the mountains and national parks in the West.
That resurgence would offer some hope to the travel industry, which racked up billions of dollars in losses as tourists and businesspeople canceled trips in the past three months because of the coronavirus epidemic. Some in the industry said the recovery was already underway.
The Fontainebleau Miami Beach resort said it was enjoying brisk business after local officials last week lifted a coronavirus shutdown order that had been in place since March.
The 1,594-room resort was about one-third full this weekend and is on track to be packed for the July Fourth weekend, said Phil Goldfarb, who oversees the Fontainebleau. But the visitors streaming in are not the ones he expected. In the summer, the hotel typically fills up largely with Florida residents. This year, the people booking rooms are coming from across the country.
“California and Texas and New York and New Jersey are the top four markets, all before Florida,” said Goldfarb, president and chief operating officer of hospitality at Fontainebleau Development, which owns the hotel and other properties. “People are getting in planes and social distancing but coming here.”
After cratering in April, the number of travelers and airline and airport employees filtering through the Transportation Security Administration’s airport checkpoints has steadily climbed in recent weeks. The low point arrived on April 14, when the agency screened fewer than 90,000 people, just 4 percent of those screened the same date last year. On Sunday, the agency screened more than 440,000 people, about 17 percent of last year’s number and the best day since March.
Investors appear to have noticed those numbers, and airline stock prices have surged.
Airlines say they are preparing to capitalize on the renewed interest in travel. Late last week, for example, American announced that its July flight schedule would be the most robust since the pandemic began, largely because of domestic bookings by people eager to get out after sheltering at home for months.
Adding flights
American plans to add flights from its hubs, including Dallas, Philadelphia and Charlotte, North Carolina, to destinations like Asheville, N.C.; Savannah, Ga.; and Charleston, S.C. It also said it would significantly increase flights to Florida and seasonal destinations in Montana, Colorado, Utah and Wyoming.
“We’re seeing a slow but steady rise in domestic demand,” Vasu Raja, American’s senior vice president of network strategy, said in a statement. “After a careful review of data, we’ve built a July schedule to match.”
American plans to operate about 55 percent as many domestic flights as it did last July. That would be up from just 20 percent in May.
United is planning for a similar, if somewhat smaller, rebound. The airline said it will add flights to New York, Boston, Seattle and Philadelphia next month to serve commercial and governmental travel. It also plans to add flights to reopening vacation destinations, including Las Vegas; Portland, Maine; Aspen, Colo.; and Jackson, Wyo.
Montana is among the states that stand to benefit from the expanded service, with American planning to nearly double the daily flights there in July. Some of those will arrive at Glacier Park International Airport, just outside Glacier National Park and a short drive from Great Northern Resort, which includes a 14-room hotel and five cabins.
The resort fielded cancellation calls for months as the pandemic spread, but things started to look up after the national park announced that it would begin reopening on Monday, said Catherine Beers, who owns the resort with several members of her family.
In May, the resort is typically about half full, Beers said, but this year it hosted only two couples all month, both locals. Since then, the cancellation calls have subsided, and the hotel is about 80 percent booked for July and August, months when it usually has no vacancies.
Looking for separation
More of her incoming calls are from people interested in booking a room or cabin because they are seeking out a destination where they can spread out.
“If you go to the grocery stores, there are people and you do have to stand on the stickers, but once you get out on the edges of bigger cities it’s so easy to be distant from people,” Beers said.
But even as the Great Northern Resort and the Fontainebleau provide early signs for optimism, the airline industry’s reckoning is far from over.
Industry executives and analysts generally agree it will be several years before airlines fly at prepandemic levels. Airlines are still losing tens of millions of dollars every day. That number is shrinking, but the losses are expected to continue through the end of the year. Generally, a flight needs to be about three-fourths full for an airline to turn a profit, but most are far from it because airlines can’t or won’t fill up planes.