CAPA: US airline market faces critical two weeks ahead
The world’s second largest aviation market, the USA, could be close to another turning point as COVID-19 cases spike across the country. The reopening of US state economies and lifting of stay at home orders had driven a slight uptick in air travel demand and airlines added more near-term capacity than expected, offering low fares to encourage travel.
But COVID-19 cases have recently surged, placing the outlook under even more uncertainty. Experiences in other domestic markets suggest that surges in cases provoke a slowing of capacity growth.
New CAPA modelling projects domestic US seat capacity to be down by 60% year-on-year by the middle of August - the summer peak - and down by almost half of last year’s level of capacity by Thanksgiving in November - but even this level of production could be hampered by the rampant spread of the virus in the US.