Delta Air Lines' corporate travel booking volumes rose 3
percent year over year during the second quarter, though "that was largely
offset by fare pressure," president Ed Bastian said during a Wednesday
earnings call.
The weakness in corporate pricing aligns with Delta's
broader results for the quarter. The airline has continued to benefit from
year-over-year declines in fuel expenses, but passenger unit revenue for the quarter
fell almost 5 percent year over year and passenger yield, a representation of
fare paid per mile, fell almost 4 percent.
Delta executives called out Chicago, Dallas and Orlando as underperforming
markets for yield. Bastian, meanwhile, also highlighted yield weakness for
close-in bookings, which business travelers tend to make at a higher rate.
"If you look at where the weakness is, it is not in
corporate demand," executive vice president of network planning and
revenue management Glen Hauenstein said. "It is in the yield that we're
obtaining from corporate demand. Corporate demand remains very, very strong even
out of these cities that have had this yield impact."
For the three months ending June 30, Delta's total passenger
revenue fell 1 percent year over year, as total expenses, anchored by declining
fuel costs, fell 9 percent. For the quarter, Delta posted a $1.5 billion net
income, up from $801
million for the prior-year period.
Meanwhile, to "stem the erosion of unit revenues," in the words of Bastian, the airline plans to hold capacity levels flat during the fourth quarter of 2015 compared to the same period in 2014.