Keeping track of which countries are reopening? So is United, which is seeing a surge in bookings
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If so, United Airlines is keeping an eye out for you.
The airline is keeping an eye on international markets as it waits for long-term travel to become feasible again, believing that pent-up demand is ready to travel across oceans again — even just for leisure travel, with business demand coming back later.
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During an investor call on Tuesday, airline executives pointed to evidence that long-distance international travel demand is ready to surge.
Bookings came quickly when Iceland reopened to vaccinated Americans, and executives said that even the rumor of a reopening is enough to drive bookings.
United has added routes to countries that have begun to reopen including Greece, Croatia and Iceland, and passengers have shown a strong interest.
“We have seen in recent weeks that immediately after a country provides access with proof of a vaccine, leisure demand returns to the level of 2019 quickly,” Andrew Nocella, the airline’s chief commercial officer, said on Tuesday’s call. “A few weeks ago there was a rumor Greece was going to open. As soon as that rumor occurred, Greece bookings took off. Athens is our second-best booked Atlantic market this summer.”
Nocella added that the airline has capacity reserved to dedicate to reopening long-haul markets, specifically citing the rumored possibility of a travel corridor between the U.S. and U.K.
“We have the aircraft standing by, ready to fly this summer,” he said. “For example, we anticipate operating between eight and 10 daily flights to London Heathrow this summer, if and when a travel corridor is permitted to open.”
Still, the resumption of long-haul travel faces numerous headwinds, including ongoing outbreaks and lockdowns in some countries amid slower vaccination campaigns. The U.S. State Department said Monday that it would add most of the world’s countries to its Level 4 “do not travel” advisory based on data from the CDC.
Notably, much of the travel demand is either leisure or a what’s known in the the industry as “VFR” — for passengers visiting friends and relatives (not to be confused with the pilot acronym for visual flight rules). That typically has a lower yield than business travel, meaning the airline must balance costs of running long-haul flights with the expected return from lower-paying leisure passengers.
Even so, with business travel not expected to begin to recover until the fall — and not in earnest until next year, CEO Scott Kirby said — the airline is keen to take whatever it can get. And that leisure demand is certainly there for the taking.
“We took over 3,000 bookings yesterday for our new services that we launched to Greece, Iceland, and Croatia,” Kirby said during the call. “If U.S.-U.K. opens up, I think you’re going to have a hard time finding a hotel room in the U.K. because there are going to be so many people wanting to go.”
“But international borders aren’t going to all reopen immediately,” he added. “International demand is going to be entirely contingent on when borders open.”
Featured image by Nicolas Economou/NurPhoto via Getty Images
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