A United Airlines plane seen at the gate at Chicago OHare International Airport (ORD) on October 5, 2020 in Chicago, Illinois.
Daniel Slim | AFP | Getty Images
United Airlines Shares fell more than 9% on Tuesday afternoon after the airline broke its fifth consecutive quarterly lossand its CEO expressed uncertainty as to when two important parts of the business will depart from the Coronavirus pandemic.
CEO Scott Kirby said the demand for long-haul and business international travel was down about 80% compared to 2019, depriving the airline of high-paying customers it relied on before the crisis.
“The big question is when those two things will come back and we’re not sure when that is,” Kirby said in an interview with CNBCs.Squawk box“He said both segments would likely recover in the summer and the second half of the year.
The Airline reported on Monday A loss of $ 1.4 billion for the first quarter that could reach profitability even if demand for long-haul international and business travel returns to 35% of 2019 levels.
United announced on Monday new flights to countries which have started opening their borders like Greece, Iceland and Croatia, and Kirby said the airline had strong bookings on these flights after they went on sale.
However, the State Department continues to advise travelers to reconsider traveling abroad. On Monday it said it would increase “do not travel” advice to 80% of the world’s countries, citing that Covid-19 pandemic represents an “unprecedented risk to travelers”.
Other airline stocks also fell. In the midday trade American was down more than 5%, Delta 4%, and Southwest more than 3%.
Domestic vacation trip bookings to popular vacation destinations like beaches have surpassed 2019 levels, Kirby said.
Vacationers flying within the US have spearheaded the recovery of travel as more people are vaccinated, governments relax travel restrictions, and tourist attractions reopen. But companies still haven’t got many of their employees back on the streets, and international travel bans or quarantine requirements continue to keep many travelers closer to where they live.
“I don’t know how people find hotels,” Kirby said of popular vacation destinations.