Delta Says It Expects Revenue Hit Due to U.S. Presidential Election
by Daniel McCarthy
Photo: Ceri Breeze / Shutterstock.com
It’s long been expected in the travel industry that presidential election years see lower demand in the weeks surrounding November. And while the pandemic might have destroyed so many knowns and dependable trends in the industry, that one is still alive, at least according to one of the U.S.’s largest airlines.
Delta Air Lines in its September financial results release on Thursday pointed to the upcoming election, which is just under 25 days away, as a reason for a softer financial outlook for the current quarter.
“We anticipate a 1-point impact to total unit revenue from reduced travel demand around the election,” Delta said in its earnings release.
While a 1-point drop in total unit revenue might not seem noteworthy, it’s still very significant in context. For instance, the CrowdStrike outage in July, which caused a $380 million hit to Delta and thousands of canceled flights, caused a 1.1-point impact to that same measurement and weeks of public, and private, litigation.
Even still, Delta expects a strong Q4. The airline said that, even with that 1-point impact, total revenue growth is expected to be up 2% to 4% compared to 2023, a year that set records for travel.
Travel agency executives talking to TMR or speaking at annual conferences this year also recognized that the election could be a drag on what’s been a banner year so far for the industry.
Virtuoso, for instance, told TMR earlier this year that it has seen over the last three election cycles that growth lowers in an election year, but that doesn’t necessarily mean that sales are negative (only one of the three cycles saw negative growth).
Other major groups talking to TMR all expressed some kind of concern that the election would have a negative effect. Ensemble’s Michael Johnson, who is Toronto-based, called the U.S.-election “the 800-pound gorilla in the room” while U.S.-based executives, like Avoya’s Phil Cappelli, said “it would make sense” that there would be some softening around November.
