Delta Air growth to slow further as US shutdown weighs
Airline warns of effect on performance while CEO says reduced government travel will cost $25m a month
Delta Air Lines on Tuesday posted a slight beat in fourth-quarter profit but forecast a drop in revenue growth in the first quarter, hit by a partial government shutdown and worries about whether airlines can raise fares in an uncertain global economy. Delta, the No 2 US airline, warned that revenue per mile flown would be hurt in the current quarter by the timing of Easter, increasing foreign exchange headwinds, and the US government shutdown, which entered its 25th day on Tuesday. Travellers are stuck in long airport queues with more and more security screeners not showing up for work during the shutdown while airlines face delays in federal certification for new routes and aircraft. Delta CEO Ed Bastian said the partial shutdown would cost $25m a month in reduced government travel. JP Morgan analyst Jamie Baker calculated that Delta generated about $475m in annual revenue through negotiated government fares. The company’s first-quarter target for unit revenue, a closely watched m...
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