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United Airlines shares rise on upbeat demand forecast despite delta variant

United Airlines shares rise on upbeat demand forecast despite delta variant

A United Airlines Boeing 737-800 and United Airlines A320 Airbus on seen approach to San Francisco International Airport, San Francisco.

Louis Nastro | Reuters

Shares of United Airlines gained close to 2% on Wednesday morning after the carrier forecast that the rebound in travel demand will continue in the coming months.

United reported its sixth consecutive quarterly loss after the market closed on Tuesday. But the airline’s losses are narrowing and the carrier said bookings have continued to improve, even for hard-hit segments like business travel and international long-haul trips.

United’s CEO, Scott Kirby, told CNBC’s “Squawk Box” on Wednesday that the fast-spreading delta variant of Covid-19 hasn’t affected bookings, echoing similar comments from Delta Air Lines’ chief executive last week.

The spread of the variant, however, could cause a “pullback” in reopening the economy but said that will be temporary “if it does happen,” Kirby said during an earnings call.

Kirby told CNBC that the U.S. should lift an entry ban on most non-U.S. citizens arriving from the U.K. and the European Union, restrictions that have been in place since March 2020.

“We’re not going to prevent the delta variant from coming to the United States by closing those borders because it’s already here,” Kirby said.

United, and other airlines and travel companies have repeatedly pressed the Biden administration to lift the restrictions, but the peak travel season has passed without any change from the U.S. However, several European countries like Greece, Spain and Italy have reopened their borders to visitors, including from the United States.

Kirby said there is a “human element” to the ban. “There’s families who haven’t seen each other in 18 months,” he said.

A White House spokesman told CNBC that government officials from the U.S., U.K., EU, Mexico and Canada are continuing to meet on how to reopen travel but didn’t say if authorities are close to a decision.

On Monday, the State Department and Centers for Disease Control and Prevention raised their warnings on U.K. travel to the highest level, telling U.S. citizens to avoid trips there.

Other airline shares also rose Wednesday, continuing their recovery from a sharp drop Monday.

American Airlines and Southwest Airlines, which report quarterly results before the market opens on Thursday, were each more than 1%. Delta was also up more than 1%.

By : ILIAS ELABDI Date : July 21, 2021 Category : Travel News & Insights Comments :

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