Delta was the first major U.S. carrier to announce earnings for the past quarter — with others to follow in the coming days — providing a window into how the delta variant of the coronavirus has hindered travel and what airlines might expect in the coming months. Soaring hospitalizations and deaths because of the delta variant, and refusals by some to be vaccinated, have upended company and travel plans.
Delta said it was operating at 71 percent of pre-pandemic capacity as of the end of September, a figure the company said would rise to 80 percent by the end of the year. Its adjusted pretax income was $216 million for the quarter.
“While the recovery in business travel paused in August and early September as case counts increased, demand has picked up since Labor Day,” Delta chief executive Ed Bastian said. Still, domestic business volume was down by more than half, the company said.
Delta executives said they have moved carefully to bring planes and schedules back online as consumer demand has recovered. Delta President Glen Hauenstein said airline management does not want to risk “operational performance issues like we’ve seen at some of our other carriers,” an apparent reference to numerous cancellations by Southwest Airlines over the extended weekend, which caused disruptions for thousands of passengers. Outside analysts have said Delta has been less aggressive in restoring service compared with some carriers.
“We want to stay where we’re confident that we can actually fly the schedules that we put out there,” Hauenstein said.
Southwest has cited staffing challenges, weather problems in Florida and temporary air traffic control issues among the causes of delays and cancellations that led the airline’s president to apologize to customers this week.
Delta reported that “approximately 90 percent” of its employees had been vaccinated as of Tuesday. That’s up from 75 percent in late August, when the company announced it would impose a monthly $200 health insurance surcharge on unvaccinated employees starting Nov 1.
While other airlines, including Southwest, have put vaccine mandates in place to comply with a Biden administration requirement for federal contractors to be vaccinated by Dec. 8, Delta has touted the success of its own approach. A spokeswoman would not say whether Delta, which does hundreds of millions of dollars in business with the federal government each year, would issue a mandate.
United Airlines put its vaccine requirement in place in August before the White House announced the mandate for federal contractors in September.
“Seven weeks later, we got 99.7 percent of our employees vaccinated,” United chief executive Scott Kirby told “CBS Mornings” on Wednesday. “I wish we would have gotten to 100 percent, but out of our 67,000 U.S. employees, there are 232 who haven’t been vaccinated, and they are going through the termination process now.”
A United spokesman would not say how many employees had sought an exemption to the mandate on religious or other grounds and been granted an accommodation.