Even with rising inflation and an increasingly uncertain economic future, consumers are still paying to travel.
On Tuesday, United Airlines said there is no slowdown in consumer travel intent despite high airfares. The carrier, which spoke as part of the company’s third-quarter earnings call, said that it expects “fourth quarter adjusted operating margin to be above 2019 for the first time,” another marker in the continued recovery of the travel industry.
According to United, which achieved operating revenue growth of 13.2% versus third quarter 2019, there are three trends that will continue to drive air travel demand despite those economic headwinds—air travel is still very much in the recovery phase and has not reached its peak, hybrid work continues to give consumers more opportunity to travel for leisure, and supply challenges will continue to limit the industry’s supply “for years to come.”
In a statement, United CEO Scott Kirby thanked employees and emphasized the company’s optimism headed into what is expected to be a busy holiday travel season.
"I am grateful to United employees who delivered an incredible performance this quarter taking care of our customers and producing, by most metrics, the best operational quarter in our history," he said.
“Despite growing concerns about an economic slowdown, the ongoing COVID recovery trends at United continue to prevail and we remain optimistic that we’ll continue to deliver strong financial results in the fourth quarter, 2023, and beyond.”
The optimism is no surprise for United, a carrier that recently expanded its summer 2023 international schedule because of high interest from consumers.
In fact, United’s third quarter was highlighted by a continued expansion of some key routes, including adding a new direct flight between Newark/New York and Dubai in March 2023 and 120 additional flights for college football season.
The carrier has also launched a new joint venture with Air Canada to give more transborder flight options to customers flying between the two countries.