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Business travel demand is ‘flat’, but revenue continues to grow due to strong demand and capacity constraints. united airlines CEO Scott Kirby told CNBC on Tuesday.
Many tech companies have announced plans to cut spending such as business travel and layoffs. San Francisco is one of United’s main hubs, along with Newark, New Jersey, Houston, Washington DC and hometown Chicago.
In an interview with CNBC’s “Squawk Box,” Kirby said, “It feels like a business trip, which is probably indicative of pre-recession behavior, with total revenues still rising but flattening out. ‘ said.
Kirby said the firm’s data doesn’t show a recession, but predicts a “mild Fed-induced recession.”
“If I hadn’t been watching CNBC in the morning, just looking at our data, the word ‘recession’ wouldn’t be in my vocabulary.
In October, United forecast new gains in the final three months of the year, thanks to strong demand. At the same time, shortages of available aircraft and trained pilots are driving up airfares across the industry, helping airlines regain profitability.
United’s Kirby says the hybrid work model has changed travel patterns, allowing workers who “always had sufficient disposable income” to travel because they are not “tethered to a desk”. repeated.
Retailers and travel companies are battling over consumer spending this holiday season as they face rising costs on everything from housing to groceries. walmart CEO Doug McMillon said on Tuesday that consumers are spending money on travel because many people were unable to travel during the pandemic. “They’re spending that money because it’s a priority,” he said on “Squawk Box.”