The news: American Airlines, Southwest Airlines, and Alaska Airlines were the latest carriers to pull their full-year forecasts, citing unpredictable travel demand in the wake of tariffs and economic uncertainty.
The situation: Lackluster earnings from all three airlines clearly demonstrate that consumers are in no mood to travel, at least in the short term.
- Demand for domestic travel “fell off considerably as we went into the February time frame,” American Airlines CEO Robert Isom told CNBC, a view echoed by Alaska Airlines.
- While the year started off strongly, consumers are now searching for cheaper flights or holding off on travel entirely.
- With no way of knowing how long this trend will hold, carriers are cutting capacity for the second half of the year, which will help them manage costs.