DELTA AIR LINES CEO ED BASTIAN DOESN’T THINK HIS AIRLINE OR THE AIRLINE INDUSTRY WILL BEGIN TO TURN AROUND UNTIL A COVID-19 VACCINE IS WIDELY DISTRIBUTED. MR BASTIAN BELIEVES THE AIRLINE INDUSTRY WILL CONTINUE TO STAGGER ALONG, AS IT DID OVER MUCH OF 2020, UNTIL MOST TRAVELERS ARE VACCINATED AND CONFIDENT TO FLY AGAIN.
“While we have high hopes that vaccinations will tame the virus this year, we also know that the next few months may be the most difficult yet,” Ed Bastian told employees earlier this month.
“It’s likely that we’ll experience two distinct phases during the next 12 months. The first will look a lot like 2020, with travel demand deeply depressed.
“The second phase will begin only when we reach a turning point with widely available vaccinations that spur a significant return to travel, particularly business travel.”
In the meantime, the Delta CEO is pessimistic about demand over the northern 2020/21 winter. He thinks COVID-19 statistics in the United States over the winter won’t improve on 2020 statistics.
“We will continue to focus on masks, regular testing, self-assessment for symptoms, social distancing, and cleaning to help stop the spread and save lives.”
Delta Air Lines will continue to block all middle seats on its flights through to March 31. It is now the only major United States airline to do so. To date, Delta has banned over 700 people from flying over their refusal to adhere to health and hygiene rules.
Typically, at the start of each year, Delta’s CEO outlines what he calls a flight plan. It’s a heads-up on what Delta plans to do over the next 12 months. Heading into 2020, Delta Air Lines was flying high. On one day over the Thanksgiving weekend in 2019, Delta took US$200 million in revenue, a record for the airline.
Unlike competitors American Airlines and Southwest Airlines, Delta was relatively unscathed by the 737 MAX debacle. The airline planned to hire thousands of more employees and expand its network, both within the United States and abroad.
However, things didn’t quite pan out as planned. This year, Ed Bastian didn’t have the heart to outline the 2021 Delta flight plan.
“As difficult as 2020 was, in many ways I expect the next 12 months to be even more challenging,” he said
“We don’t yet know what travel demand is going to look like when it rebounds. We need to be nimble as consumers make the path forward clear. Simply re-creating the Delta from 2019 won’t be an option. Our customers will give us the blueprint for the Delta of 2021 and beyond.”
But it’s not all gloom and doom from Delta’s C-Suite. Ed Bastian is confident about the effectiveness of a COVID-19 vaccine. It’s more a question of the timeline to roll it out. Right now, Delta’s CEO thinks the airline will achieve positive cash flow by the northern spring.
In large part, that depends on the rebound of business travel. That, in turn, depends on travelers being able to get vaccinated and then having the confidence to fly. Ed Bastian can’t do much about the vaccination rollout timeline. But he can do a lot to instill confidence.
“Keeping our people, our customers and our communities safe has never been more important,” he said. That’s why Delta Air Lines continues to push forward when it comes to aircraft hygiene, social distancing, and COVID-19 era traveling etiquette.
Mr. Bastian also views the tumult as an opportunity. He thinks there’s an opportunity to come out the other side as a better and stronger airline.
“No airline is better positioned than Delta to emerge stronger from this crisis and lead our industry in the years ahead. I believe we will see 2021 as a turning point that results in an even stronger, customer-focused, and successful Delta that will connect the world for generations to come.”
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