In a post-pandemic world, Delta Air Lines, Inc. (NYSE: DAL) will be significantly smaller, expand its definition of safety to include protecting customer and employee health, and take until mid-2023 to get to real growth again.
“A recovery will be dictated by our customers feeling safe, both physically and financially, to begin to travel at scale,” CEO Ed Bastian said on an analyst call Wednesday to discuss the company's first-quarter pretax loss of $422 million. “Given the combined effects of the pandemic and associated financial impact on the global economy, we believe that it could be up to three years before we see a sustainable recovery. And to succeed through that environment, we will likely need to resize our business in the near term to protect it in the long term.”
Bastian's transformation message is one that will likely be repeated throughout the airline industry in the coming weeks as fallout from the coronavirus quarantines and social distancing lasts into the summer and beyond.
United Airlines said it lost $2.1 billion in the first quarter.
Analysts say the industry's path to recovery will be uneven and L-shaped — the hope for a U-shaped recovery has been discarded — as the U.S. and other nations open up their economies in a phased approach. In some parts of the country, stay-at-home orders could extend through June — or longer.
When consumers will feel confident enough to fly again is anyone's guess. Many will be cautious for fear of getting infected or spreading the disease to a loved one. The destruction of economic activity and resulting widespread unemployment means many people …
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