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American Airlines Forecasts a Better End of the Year

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American Airlines recently revealed that they experienced a smaller than initially anticipated loss for the third quarter, while also forecasting a better end of the year for bookings. Previously, the airline company — as well as many other airline companies based in the United States — warned investors that their third-quarter earnings would not be as good as initially anticipated. Now, however, it appears that the company is looking forward to the future.

According to the company, the airline is looking forward to the future and expects travel bans to be lifted, as well as holiday traffic to increase. The end of the year will likely see many people traveling around during the holiday season, something that American Airlines is counting on. The recent drop in COVID-19 cases around the nation is hopeful for the company, as well as other businesses in the travel industries.

Earlier this year, the Delta variant of COVID-19 caused airline bookings to slow down immensely, and cancellations were also a major issue. Consumer demand for travel decreased greatly during this time, as cases were so rampant in so many parts of the nation. However, new data has suggested that COVID-19 infections have gone down around the country for the last few weeks, which will be positive for the airline company in the near future.

Consumer confidence, however, is still low, mainly because of the Delta variant and other economic issues, such as labor and material shortages. Consumers may not immediately want to travel again. However, it is expected that consumer confidence may rise again, especially as COVID-19 cases drop. We may see this confidence rise once data comes out about how people are traveling in the next few months.

American Airlines is also looking forward to traveling bans being lifted. The White House recently announced plans to reopen the country to air travelers from Europe in November. International travel has largely been regulated in the United States and in Europe since the pandemic again, though flights still flew these routes. To have the regulations taken away may help American Airlines, especially as the company may be able to finally add more routes and flights to these European international destinations. 

Of course, any type of increase in travel — whether it is national or international — will be beneficial to the company. American Airlines revealed that their third-quarter losses would be somewhere between $620 million and $675 million. While large, the loss was initially expected to be at about $741.7 million. 

Because of the decrease in COVID-19 cases around the country, as well as the optimism that international travel restrictions may be taken away, American Airlines is confident that the fourth quarter will see a large peak in traveling. Obviously, this will allow the company to do quite well. The holiday season often sees large numbers of people traveling. While 2020 saw fewer people travel than normal, many still did travel during this time. 2021 may see even more people taking the opportunity to travel, especially as more Americans become fully vaccinated around the country.

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