Also read: United announces largest widebody aircraft order ever placed by a U.S. carrier
Delta Air Lines also maintains a bullish travel forecast despite weakening demand among smaller carriers. The carrier has recently boosted its fourth-quarter earnings outlook and full-year outlooks for 2022 through 2024.But smaller airlines are not as optimistic as Delta and United. JetBlue Airways, Alaska Airlines, and Spirit Airlines cut their revenue forecasts for the fourth quarter of the year, stating that 2023 could be a tough year for the industry.
On the other hand, economic projections make it evident that risks for the aviation industry lie ahead, says Sage-Popovich, Inc. (SPI), a Chicago-based global aviation consulting and asset management firm.
According to SPI, owners of aviation assets may have to face severe economic consequences due to rising interest rates and a probable U.S. recession. Additionally, global inflation is soaring and reaching new highs; in October, double-digit inflation rates were recorded in more than half of the nations that make up the Eurozone. The ongoing conflict between Russia and Ukraine has also driven up airline operational costs. Additionally, other economic considerations, including rising fuel costs and employee salaries, are generating pressure on the companies as well.