DELTA Air Lines CEO Ed Bastian said in a memo yesterday that he continues to expect that the company will achieve positive cash flow by the spring of this year.
In his new year note to employees, Bastian said that company will likely “experience two distinct phases during the next 12 months, while the first phase will be similar to 2020.
“The second phase will begin only when we reach a turning point with widely available vaccinations that spur a significant return to travel, particularly business travel.”
Bastian had told investors in October that Delta plans to start paying down its debt in 2021 once it has positive cash flow.
Revenues at Delta, which is blocking middle seats until March 30, fell 76% to US$3.1 bil in the third quarter from a year earlier.
“As difficult as 2020 was, in many ways I expect the next 12 months to be even more challenging,” he added.
Last month on Dec 3, 2020, it was reported that Delta Air Lines said on Thursday it expects a cash burn of about US$12 mil to US$14 mil per day in the fourth quarter as slowing demand amid a spike in COVID-19 cases adds about US$2 mil per day to its burn rate.
“We’ve seen some slowing of demand and forward bookings as COVID-19 cases have risen across the US,” Delta Air Lines Ed Bastian said in a memo to employees.
The carrier said fourth-quarter revenue could fall to 30% of 2019 levels, which was US$11.44 bil.
Meanwhile, Delta is partnering with the Centres for Disease Control and Prevention to keep international customers informed of potential COVID-19 exposure through contact tracing.
The airline said it will ask customers traveling to the US from an international location to voluntarily provide five pieces of data to aid contact tracing and public health follow-up efforts beginning Dec 15.
Earlier on that day, Spirit Airlines said it expected its load factor for the fourth quarter to average about 70%, despite the slowdown in demand due to the COVID-19 pandemic. – Jan 2, 2021
