By David Koenig, AP Airlines Author
DALLAS (AP) – How bad was 2020 for the bus airline industry? The six largest US airlines lost $ 34 billion and Southwest suffered its first-year loss as Richard Nixon was president and gasoline was sold at 36 cents a gallon.
It was a disaster for airlines, worse than 9/11 or the global financial crisis – some very small carriers could not survive it – and the new year is off to a serious start.
On Thursday, Southwest, American and JetBlue reported that they lost a combined $ 3.5 billion in the final three months of the year. All issued disappointing revenue outlooks for the current quarter that echoed similar pessimism from Delta, United and Alaska, Which previously posted financial results.
Airlines are looking into last spring and are hoping that as more people are vaccinated against COVID-19, they may be able to save some from the peak summer vacation season.
But even more cautious optimism is threatened. Yes, the number of new cases of coronavirus in the US has decreased over the past few weeks, but they remain high. And now a halt rollout of the vaccine has threatened to further delay a recovery in the travel and travel industry.
President Joe Biden this week imposed a COVID-19 travel ban on most non-US travelers to Brazil, Britain and South Africa. A new US requirement also requires that non-citizens provide proof of a negative test for COVID-19 before flying to the United States.
On Thursday, the airlines reported the results, a new coronovirus variant identified in South Africa was first found in the United States, with two cases diagnosed. South Carolina.
American Airlines CEO Doug Parker said, “Travel restrictions have decreased demand due to international restrictions.” “We’ve seen things like Mexico and the Caribbean, especially on short-haul international travel.”
The airlines support the testing of international passengers, noting that as a way to eliminate other border barriers and quarantine requirements. However, they are dead against testing travelers within the United States, calling it costly and impractical.
A top official at the US Center for Disease Control and Prevention said this week that the health agency was “actively looking” at testing passengers before boarding domestic flights.
Southwest CEO Gary Kelly argued that the US has limited testing capacity and should focus its virus-control efforts to get people vaccinated faster.
“Why Travel by Air?” Kelly said. “If you want to test people, test them – but test them before going to the grocery store, test them before going to a restaurant.”
Due to the possibility of travel being weak for several months, airlines continue to reduce costs and workers are being encouraged to leave. Federal aid has led to more furloughs, at least through March. Low on revenue, airlines have made tens of billions of dollars from private lenders and taxpayer-funded relief.
The focus is now on the rate of cash burn, a balancing act that is necessary to ride the global epidemic. American said it would lose $ 30 million a day in the first quarter. Southwest expects to burn $ 10 million to $ 15 million a day.
Wall Street analysts expect that airlines will lose money again this year, according to data compiled by FactSet.
American Airlines Group Inc. reported a loss of $ 2.2 billion in the fourth quarter and $ 8.9 billion for all of 2020, making $ 1.7 billion a year earlier.
Revenue declined more than 64% to $ 4.03 billion in the fourth quarter and Fort Worth, Texas-Beded airline forecasts a similar trend for the first quarter of 2021 – it expects revenue to reach 60% to 65% year-over-year numbers.
American expects to earn about $ 30 million a day in the first quarter, almost the same as the fourth quarter.
American’s shares rose 17%. Analysts say the US is now stuck in volatile trading that has seen other stocks, especially Gametop, wrapped up in a fight between small investors and short sellers. Parker declined to discuss the situation or said whether the US would issue new shares while the stock price would rise.
The fourth quarter loss after taking out the special profit was $ 3.86 per share. Analysts expected a loss of $ 3.92 per share according to a survey by Zacks Investment Research.
Southwest reported a loss of $ 908 million for the fourth quarter, compared with a profit of $ 514 million a year earlier, and said bookings stalled due to the high number of newly reported cases of COVID-19.
Dallas Airline predicted that January revenue would fall 65% compared to the same month last year, and February revenue would fall from 65% to 75%.
Kelly said vaccine availability “should mark the beginning of the end of this epidemic” even though current passenger bookings are not showing it.
Southwest’s adjusted loss of $ 1.29 per share was smaller than Wall Street’s. Analysts in the Zacks poll predicted $ 1.69 per share.
Revenue fell 65% to $ 2.01 billion.
Southwest shares rose nearly 2%.
JetBlue reported a $ 381 million loss after reporting profit in the fourth quarter of 2019 New York-Beded airline said its adjusted loss was $ 1.53 per share, compared to an average forecast loss of $ 1.72 per share in the ZACS survey.
For the year, JetBlue lost $ 1.36 billion.
JetBlue shares rose slightly.
David Koenig can be reached at www.twitter.com/airlinewriter
Copyright 2021 The Associated Press. All rights reserved. This content may not be published, broadcast, rewritten or redistributed.