Throughout the ongoing travel slump, airlines have been quick to cut capacity on underperforming domestic routes, but less eager to reduce flights on international service. The reason is simple: International flights are generally very profitable, and legacy lines face hardly any competition from low-cost carriers.
But international flights are profitable only when people are flying, which isn't the case now and may not be for some time. And when people stop flying, these long-haul routes become veritable money pits in the sky. No surprise, then, that Delta announced big cuts to its international routes for the coming winter, predicting an 11 to 13 percent reduction on transatlantic capacity, and 12 to 14 percent on transpacific service. Overall, the carrier will cut back international travel by 10 percent later this year.
It will be interesting to see if Delta's competitors follow suit and begin scaling back international service as well. United already hinted at softness in its international routes by discounting award seats to Europe last month. Those words—"discounted award seats to Europe"—would have been anathema to the industry just a year ago, but no longer. Airlines are staring down a prolonged decline in travel, and cannot afford to carry any route that doesn't make money. Suddenly, that category includes once-reliable international routes, a shift that could spell tougher times ahead for the industry.
I, for one, expect more carriers to start trimming international capacity. I don't see how they have much choice, but I also don't know if it will help. Trimming capacity here at home has helped carriers' punctuality, but it hasn't done much for their bottom lines. Domestic deals are still plentiful, and until travel picks up again, will remain so. Will the same happen for international travel? This is the time of year when prices begin their annual upward climb for the summer season, so keep an eye on our airfare deals to see what's going on (I will, too). Money talks, after all, so let's see what it has to say.