Spike in COVID-19 cases is starting to hurt air travel
America's largest domestic airline warned Wednesday that a rising number of COVID-19 cases is starting to hurt its business.
Southwest Airlines "has recently experienced a deceleration in close-in bookings," the company noted in a filing with the Securities and Exchange Commission. Southwest said that was paired with "an increase in close-in trip cancellations in August 2021." The airline blamed the recent rise in COVID-19 cases associated with the delta variant.
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If those trends continue, Southwest predicts its revenues will be 3% to 4% lower than what it had told Wall Street just three weeks ago. If the trend continues, Southwest warned that it might not be profitable in the July-to-September quarter, traditionally one of the busiest and most-profitable for airlines.
The news comes a week after budget carrier Frontier Airlines announced that it also was seeing a drop in bookings, something it also tied to the delta variant.
Industry experts had predicted that leisure travel would start to wane in September as schools and offices reopened. Business travel was supposed to start to tick up.
But now that outlook may prove to be too optimistic. Many major companies have pushed back their office reopening plans. And if nobody is in the office, then there is little reason to travel to visit clients.
More: Southwest Airlines CEO says Miami push part of long-term strategy, not ‘pandemic play’
While borders are finally reopening for Americans to countries including the United Kingdom and Canada, the timing couldn't be worse with the Centers for Disease Control and Prevention saying that most of the country is experiencing substantial or high levels of COVID-19 community transmission.
Personally, my family on Tuesday decided to cancel our long-planned trip in late August to Aruba following the CDC's announcement Monday adding Aruba, France, French Polynesia, Iceland, Israel and Thailand to its "avoid travel" list. (Sorry Delta Air Lines but we redeposited 276,000 SkyMiles back into my account for those three first-class tickets - I had purposely booked with miles for added flexibility.) We have a six-year-old daughter who isn't vaccinated and felt it wasn't right to travel with her or risk a positive test and being stranded in Aruba, unable to come back to the U.S.
It pains me that we are now back in the mindset of canceling trips again. If you are thinking about doing so, TPG's Benji Stawski has a great guide here about what you need to do if you plan to cancel your vacation.
The team at TPG is going to continue to update you on the impact of the delta variant on travel as well as the latest government advisories.
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How we chose these cards
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Annual Fee
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Why We Chose It
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Cons
- $95 annual fee
- Lacks travel protections that other travel rewards cards come with
- For a limited time, earn 80,000 bonus ThankYou® Points after you spend $4,000 in purchases within the first 3 months of account opening
- Earn 3 Points per $1 spent at Restaurants and Supermarkets
- Earn 3 Points per $1 spent at Gas Stations, Air Travel and Hotels
- Earn 1 Point per $1 spent on all other purchases
- Annual Hotel Savings Benefit
- 80,000 Points are redeemable for $800 in gift cards when redeemed at thankyou.com
- No expiration and no limit to the amount of points you can earn with this card
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Rewards Rate
| 3X | Earn 3 Points per $1 spent at Restaurants and Supermarkets |
| 3X | Earn 3 Points per $1 spent at Gas Stations, Air Travel and Hotels |
| 1X | Earn 1 Point per $1 spent on all other purchases |
Intro Offer
For a limited time, earn 80,000 bonus ThankYou® Points after you spend $4,000 in purchases within the first 3 months of account openingEarn 80,000 ThankYou® points60,000 pointsAnnual Fee
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Why We Chose It
The Citi Premier’s 3 points per dollar spent across a wide range of popular categories is one of the more lucrative offerings in the world of points and miles. The Citi Premier comes with a $95 annual fee and is currently offering a solid sign up bonus of 80,000 points after you spend $4,000 on purchases within the first three months. It also has some valuable transfer partners to make the most of your rewards. Add in access to Citi Entertainment plus a $100 hotel credit for any single-stay hotel booking that exceeds $500 or more, excluding taxes and fees, booked through the Citi travel website, there are few reasons why the Citi Premier should not be in every traveler’s wallet.Pros
- Earns 3x points on restaurants, supermarkets, gas stations, air travel and hotels.
- $100 annual hotel savings benefit (on single hotel stay bookings of $500 or more, excluding taxes and fees, booked through thankyou.com)
- Points transfer to 16 airline programs, from JetBlue to Virgin Atlantic.
- World Elite Mastercard benefits, extended warranty, damage and theft protection.
Cons
- $95 annual fee
- Lacks travel protections that other travel rewards cards come with
- For a limited time, earn 80,000 bonus ThankYou® Points after you spend $4,000 in purchases within the first 3 months of account opening
- Earn 3 Points per $1 spent at Restaurants and Supermarkets
- Earn 3 Points per $1 spent at Gas Stations, Air Travel and Hotels
- Earn 1 Point per $1 spent on all other purchases
- Annual Hotel Savings Benefit
- 80,000 Points are redeemable for $800 in gift cards when redeemed at thankyou.com
- No expiration and no limit to the amount of points you can earn with this card
- No Foreign Transaction Fees on purchases