The rapid expansion of US airlines from the Covid-19 pandemic has reached an “self-imposed” end, as expressed by Delta Air Lines Ed Bastian’s CEO on Wednesday.
The macroeconomic uncertainty around global trade has brought the expansion of several years of Delta, which has included New international markets and a Expanded approach city At the Austin-Bergstrom (AU) International Airport, to stop, Bastian said during a quarterly gain call.
“When we reach 2025, we are positioned for another year of strong growth,” he said. “However, given the broad economic uncertainty about global trade, growth has stagnated to a large extent.”
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The Delta schedules will largely remain intact for the balance of the second quarter that extends until June, with perhaps some “cuts” selected by the edges, “said Glen Hauenstein, president of the airline. After June, however, the carrier will reduce any planned growth and, instead, will focus on the profitability of his main business.
The news occurs in the middle of a rapid deterioration of economic indicators in the main rates of US shares. UU. They have dramatically fallen and eliminated billions of dollars in wealth since President Trump revealed his fee plans on April 2, and the conference board index followed by the short -term perspective of the consumer perspective in the short term in the short term It fell in March at the lowest level in 12 years.
In a publication on social networks on Wednesday after Delta’s call, Trump said he would stop all the new specific reciprocal rates of the country, except those of China for 90 days. Its universal rate of 10% in imports remains.
Bastian and other Delta executives avoided any mention of Trump specifically during the call, instead of limiting comments to uncertainty about tariffs and global trade. That avoidance was far from Bastian’s description in November of the then Trump administration, as a “breath of fresh air” compared to the outgoing Biden administration.
“The airline sector is in the eye of the storm,” wrote Tom Fitzgerald, an analyst at the TD Cowen investment bank, about economic uncertainty on Wednesday.
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Delta’s executives described the good and bad of the current situation.
The trip of the national economy has fallen
“The impact has been more pronounced in national and specifically in the main cabin gently both in corporate and consumer trips,” Bastian said on the situation.
Delta plans to reduce domestic capacity, particularly in the second half of the year, in response, said Hauenstein. Most of the cuts are expected after August 15, most schools in the southeast of the United States, where Delta is strong, the return of summer holidays in early August, and in the balance of the year.
The carrier reduced his prognosis of capacity growth for the second half of 2025 from 3% to 4% by plane year after year.
The cuts, at least initially, will focus on the maximum days versus the peak peaks, said Hauenstein. That means that Delta could pass five flights on a route on Tuesdays, one of the days of less demand of the week, only three or four flights while keeping the five flights on Fridays busy.
Delta executives refused to prepare more about where the cuts could occur, except to say that they will concentrate on the domestic market.
“We are going to eliminate the non -profitable flight wherever it is,” said Hauenstein.
A way in which Delta will delay growth is accelerating aircraft retirees. The airline will eliminate at least 30 Boeing 757s older, Boeing 767s, Airbus A319 and Airbus A320 of its fleet in 2025, said Dan Janki, Financial Director of Delta.
International trips are resistant … for now
Americans still travel or are eager to travel abroad, at least with Delta, executives said. That is even true as foreigners, even Canada and Western EuropeThey are increasingly denying trips to the US.
“Internationally, approximately 80% of the income is the point of origin of the USA, with reserves that remain strong for the maximum summer period,” said Hauenstein. The key here is that Delta sells 80% of its seats on international flights to US travelers, which limits exposure to any decrease in trips from abroad.
When asked why international trips among Americans remain even when domestic trips slow down, Hauenstein said: “The cohort that travels at this time has an average age in the 60s, which means that the baby boomers are traveling. And, you know, it’s a baby boomer, I can say this without fear of remuneration. Recent, and want to do things.
“We are closely monitoring the demand, closer to what we have seen before,” he added.
Delta Will Add service to Catania Airport (CTA) on the Italian island of Sicily as one of At least eight new routes To Europe this summer. And next winter, the airline plans to add 10 new routes To Mexico and the Caribbean.
The demand for premium trips, Hauenstein added, has also proven to be resistant in Delta, even when the demand for the economy has slowed.
Delta will not pay tariffs in airplanes
“We will not pay tariffs for the delivery of airplanes that we will take,” Bastian said in response to a question about tariffs on new aircraft.
Import taxes could be expensive for Delta, and all airlines, given the global nature of the aerospace supply chain. The 43 of its delivery of aircraft scheduled in 2025 are from the European manufacturer of Airbus aircraft, shows the last fleet plan of the aircraft carrier. That includes 12 A330-900 and A350-900 assembled in Toulouse, France; 21 A321neos, typically assembled in Hamburg, Germany or Mobile, Alabama; and 10 A220-300 assembled in Mobile or Montreal.
But even Airbus aircraft gathered in Alabama have global supply chains. The fuselage and other critical components in A321neos are placed on mobile devices are sent aboard the dedicated Mobile Express From Europe to the United States
“We will differ any delivery that has a fee on it,” Bastian said when he was asked how Delta would avoid the levies.
Delta has previously demonstrated experts in avoiding import tariffs. In the past, he received the delivery of new airplanes and then has dedicated them to only international routes to avoid the levies if the plane flew a national flight.
“It’s hard to know how this will develop since this is something self -imposed,” said Bastian. “I hope that sanity prevails, and we will advance through this period of time on the relatively fast commercial front. But we are prepared in any case to make sure to protect Delta through this.”
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