Delta CEO says air travel 'at a stall' amid resurgent virus, recovery over two years away
Tracy Rucinski
July 14, 2020 / 7:06 AM / Updated 16 minutes ago
CHICAGO (Reuters) - Delta Air Lines ( DAL.N) warned on Tuesday it will be more than two years before the industry sees a sustainable recovery from the “staggering” impact of the coronavirus pandemic, with demand largely tracking the curve of infections in different places.
“We’re at a stall right now,” Chief Executive Ed Bastian told Reuters, saying demand that built up over June for travel to places like Las Vegas, Florida or New York had suffered due to fresh cases and quarantines, while picking up to some mountain and international destinations.
The Atlanta-based carrier has scaled back the flights it planned to add in August to 500 from 1,000.
Shares were down 1.9% pre-market.
Delta posted a $2.8 billion adjusted net loss, or $4.43 per share, for the second quarter as passenger revenue plummeted 94% during a season that some analysts call the worst in aviation history.
Delta stuck to its target to halt a daily cash burn, which hit $100 million at the start of the pandemic, though Bastian warned it hinges on demand.
“There’s a lot of risk because it’s hard forecasting what’s going to happen with the virus,” he said.
The airline slowed its daily cash burn to about $27 million in June and sees a similar rate in July, with improvements as economies open and people feel more comfortable traveling.
Delta had $15.7 billion in liquidity at the end of June. It has not decided whether to take a $4.6 billion secured loan under the CARES Act - available until Sept. 30 - as it eyes other options involving similar collateral, Bastian said.
continues at reuters.com |
