US airlines are trimming routes and giving up on financial forecasts as a potential recession dampens consumer demand.
With polls showing a strong majority of Americans don’t support President Donald Trump’s tariffs and one-half of residents fearing a recession, major US airlines are giving up on trying to forecast their finances for the year.
American Airlines pulled its financial guidance for 2025 on 24APR, joining rivals Southwest and Delta in declaring the economic outlook too uncertain to provide full-year forecasts, The Globe and Mail reports. All three airlines cited weakening sales among economy class leisure travellers.
“We came off a strong fourth quarter, saw decent business in January, and really domestic leisure travel fell off considerably as we went into the February time frame,” American Airlines CEO Robert Isom told CNBC.
The carrier said efforts to improve its profitability had been outweighed by softening demand for domestic leisure travel and a fatal collision in January near Washington, D.C. American reported a net loss of $437 million for the first quarter.
Southwest this week pulled back its financial forecast and said it is trimming flights “as Trump's trade war has created the biggest uncertainty for the industry since the COVID-19 pandemic,” MSN.com reports.
“With little clarity on how consumers will behave in the face of a potentially worsening economy, airlines are struggling to accurately forecast their business.”
AviationA2Z said as the leading US carrier by passenger volume, Southwest cuts in domestic service could disrupt American’s vacation plans.
Alaska Air Group also pulled its 2025 profit forecast this week, citing economic uncertainty. Frontier also has scrapped its forecast.
Under current market fluctuations, United Airlines last week gave two different forecasts, a highly unusual move. “We think there is a reasonable chance things can weaken from here,” United CEO Scott Kirby said.
Delta Air Lines, the nation’s most profitable carrier, predicted as recently as January that the company was on track for the best financial year in its history. Earlier this month, the airline scratched its performance expectations for 2025 and said it was putting a planned flight schedule expansion on hold.
Air Canada is set to release its first quarter financial results on 09MAY.
