There's one sure sign that travel demand is rebounding this summer: the return of news stories detailing the woes of angry, frustrated passengers forced to camp overnight in airports.
This week is Spirit Airlines' turn in the spotlight, as hundreds of cancellations and delays early in the week have led to long customer service lines and passengers stranded in Florida airports, but other U.S. carriers have had similar experiences this summer. In Southwest Airlines' second-quarter earnings call, COO Mike Van de Ven acknowledged that June was its "most difficult month," with technology issues causing delays following some periods of bad weather. As such, the carrier's on-time performance for the month was 62.4 percent.
"The pandemic turned everybody's world upside-down, and it's still not completely right-side up," Southwest CEO Gary Kelly said in the call. "Normal summer demand is always a challenge to manage, more so here in 2021 and especially in June, when we had technology issues and bad weather combined."
American Airlines also garnered attention when it trimmed its July schedule to maximize operational efficiency. More recently, the carrier reported that it was seeing delays in jet fuel delivery, cautioning that it might have to add stops to some flights, though noting that fuel shortages had not yet significantly affected operations.
Summer Strains
The July 4 holiday weekend in particular was a stress test for carriers, with the U.S. Transportation Security Administration reporting passenger volumes higher than pre-pandemic levels, said Manoj Chacko, head of the travel and leisure business unit for business process management technology company WNS Global.
"Due to the spike and increasing amounts of customers and limited staff, many airlines that weekend, and even now, find themselves overwhelmed with demand," Chacko said. "This has already led to major issues, such as insanely long customer service lines, digital website errors, delayed or canceled flights, and so on."
As airlines forecast corporate travel demand and capacity to return to higher levels this fall, what do these operational issues portend for business travelers in terms of delays and cancellations, particularly coupled with a more challenging airport experience?
The good news is that, as compelling as video of long lines and irate passengers can be for television news broadcasts, there has been nothing particularly extraordinary about the rate of delays and cancellations so far this summer, Cirium consultant George Dimitroff said.
"We have no reason to believe that any weather-related or operational disruptions experienced by airlines recently are any different [than] disruptions they experienced before the pandemic," he said. "If anything, airlines should be able to handle schedule disruptions better right now because the fleet is still not operating at its maximum potential utilization. Those early morning and late evening flights are not squeezed into the daily routine yet, and airlines are allowing longer turnaround times in between flights, so when a flight is delayed there is more of a buffer to absorb a delay until the next scheduled flight by that aircraft."
Despite the headlines American Airlines made, for example, president Robert Isom in the carrier's earnings call said that its second-quarter completion factor was 98.6 percent and on-time arrival rate was 82.1 percent, marking "our best-ever performance for those two metrics in the second quarter." That came as American scaled up operations to more than two and a half times the number of flights operated the same time last year, he said.
OAG this week reported that in July, U.S. carriers had an average on-time performance of 85.1 percent, compared with 78.1 percent in July 2019, showing a clear improvement with less congestion in the air and on the ground.
Rebuilding Staff
The issue now, according to Dimitroff, is that airlines are facing "temporary operational inefficiencies" when faced with weather or other significant disruptions due to staff reductions during the pandemic. That can make it tougher to get things moving again quickly, he said.
Airline executives said they are confident they will have sufficient staff for the expected ramp-up in travel demand this fall. American's Isom said the carrier already has completed all recalled pilots' training and brought back more than 3,000 staff members from leave. It plans to bring 1,000 more flight attendants back from leave this fall and hire more than 350 pilots this year, followed by hiring more than 1,000 pilots and 800 flight attendants next year, he said.
Southwest's Van de Ven said the carrier is "adding staffing in several of our large cities" and has upped its minimum starting pay to better attract applicants while offering premium pay to entice employees to pick up open shifts. The carrier also is sourcing flight instructors to handle the training needs of pilots as they return from leave, he said.
"It feels really good to finally be in a position where we can add flights and pick up our operating momentum," Van de Ven said. "It was a bit messy as we throttled down our activity, and it doesn't surprise me that it's a bit messy as we are accelerating it, but our employees have navigated through those things heroically."
In a July 27 memo, Delta Air Lines CEO Ed Bastian said the carrier is facing a "record-breaking level of calls" to customer service as demand returns and is bulking up staffing to manage it. In addition to bringing back employees from leave, it is hiring 1,300 customer service specialists who will be trained and ready to start by September, part of more than 5,000 people the carrier plans to hire across the business, according to Bastian.
Leaner Schedules
Meanwhile, with leaner schedules, airlines have fewer options to reaccommodate passengers during irregular operations. That will continue to be an issue in the fall, said Jeremy Quek, American Express Global Business Travel's principal global air practice line lead. Data from mid-July, for example, showed that the business-heavy route between Boston and New York's LaGuardia Airport had about 60 percent fewer options in September and October compared with the same period in 2019, he said. That's an improvement from the second quarter, when there were 78 percent fewer flights available on that route compared with 2019, but it still makes planning more of a challenge even during normal operations, as airlines concentrate more on leisure destinations as they rebuild schedules.
"When meetings run over, [previously] you might not have been concerned because you could catch another flight, but you will need to recalibrate those expectations," Quek said. "Ultimately, we will see all of that return, but you won't see a full schedule return in that September-October timeframe."
Business travelers going to secondary or tertiary markets might find they need connecting flights on routes that previously had direct service, and those who make last-minute bookings could face availability issues as networks rebuild, he added. When irregular operations arise, business travelers should be prepared to have to cancel trips altogether, as it will be less likely they can be accommodated quickly, he said.
Airlines, meanwhile, are adjusting policies to ease the transition. Delta, for example, changed rules around Basic Economy fares to allow flight changes through the end of the year, which Bastian said will help "address call wait times as we increase staffing." Airlines also have access to tools that can simulate demand ahead of high-volume periods to have their teams prepared when the time comes, according to WNS Global's Chacko.
Other changes in the industry might be happening quietly, Cirium's Dimitroff said.
"Perhaps airlines might also have to relax some their stringent cleaning procedures in between flights that they introduced in 2020, although this will almost certainly go unpublicized," he said.
Despite the challenges ahead, Dimitroff said delays and cancellations should be no worse than they were prior to the pandemic this fall. It just might feel that way to some business travelers.
"Maybe we have simply forgotten how unpleasant the travel experience could sometimes be when weather or other disruptions get in the way," he said.