Corporate travel expected to grow in 2016

Delta Expects Corporate Demand Growth In 2016
By Michael B. Baker, Business Travel News Editor

Despite looming global economic concerns, Delta Air Lines projects corporate demand will strengthen year over year in 2016, executives said during the carrier’s fourth-quarter earnings call.

Corporate demand increased 3 percent year over year during the fourth quarter, although it declined in Europe after the Paris terrorist attacks, Delta president Ed Bastian said.

Executives also said load factor, in terms of advance bookings, is running ahead of expectations through early summer. “Corporates continue to tell us they expect growth in 2016 over 2015 levels,” Bastian said. “There’s pricing pressure out there, with fuel prices half of what they were a year ago, but the business looks pretty healthy.”

Even so, Delta plans to adjust capacity this year to “reduce exposure in some international regions,” he said. For the full-year 2016, Delta projects domestic capacity will rise between 1 percent and 3 percent and total capacity will either maintain or increase as much as 2 percent.

During the fourth quarter of 2015, total passenger revenue declined 1.3 percent year over year to $8.1 billion. Foreign currency pressure led to that decline, according to Delta.

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