Delta expects higher fares and strong demand through the holiday season

Delta Air Lines reported a huge jump in fuel costs, but said passengers are continuing to book flights despite the significantly higher airfares.

And Delta is betting travelers will keep paying more to fly this holiday season, bolstered by higher-income customers willing to splurge on premium seats.

The airline, the first major carrier to report financial results, said its jet fuel costs jumped 60%, a $1.6 billion increase in the third quarter compared to a year ago. Fuel is the second largest cost for airlines, behind only labor.

But Delta also said passengers paid about 15% more to fly, leading to a 2% increase in adjusted net income despite the cost of higher fuel.

“To not to dent those profits, to me is incredible,” said CEO Ed Bastian in an interview on CNBC early Friday after reporting third-quarter results. “In past cycles, past shocks, if we saw a 60% increase in fuel prices, we’d be flat on our back.”

And Bastian said the demand to fly remains strong, despite the sharply higher fares. He expects both that strong demand, and higher fares, to continue through the rest of this year and into next year.

“We’re not seeing any slowdown at all. Our consumer is resilient,” he said. “The fares will be a function of what the market bears.”

Much of the increase in fares and revenue comes from passengers who are willing to pay for premium seats on planes, from “comfort plus” and “premium select” in the main cabin up to first class and business class. The revenue from premium seating rose 18%. Bastian said the households in the top 40% in terms of income “are basically our customers.”

“Their priority is to travel,” he said. “So, from our standpoint, we the more premium we have, the more we’re selling out.”

Airlines can’t just pass on higher costs in the form of higher fares when its costs rise unless there remains customer demand to travel. But higher fuel prices do lead airlines to cut their planned schedules , eliminating flights that were barely profitable even before the spike in fuel costs.

Despite the strong demand, the available seats on Delta during the just completed summer travel quarter was essentially unchanged from a year ago. And that limited number of seats, in the face of strong demand, led to 86% of available seats being full throughout the quarter, and upward pressure on fares.

Experts in the field agree that they’re seeing strong demand to travel and higher fares through the rest of this year. Passengers are booking holiday travel earlier this year than in past years said Hayley Berg, lead economist at travel site Hopper. And they’re paying more to do so.

“Thanksgiving already averaging $400 a ticket, up 31% year over year,” she told CNN ahead of the Delta report. “Christmas, which is always about $50 more expensive than Thanksgiving, about $450, up 23% year over year.”

Earlier this year, when the price of jet fuel fell sharply from a peak reached in April after the start of the war in Iran drove up the cost of energy, Delta and other airlines did not lower their fares . Fuel has started to climb back up, and Bastian said he expects higher fuel costs to remain through the fourth quarter.

Delta’s earnings were slightly below Wall Street forecasts and it lowered its guidance for the rest of the year. Shares of Delta ( DAL ) and almost all other US airlines fell slightly in premarket trading.

达美航空公司报告称燃油成本大幅上涨，但表示尽管机票价格大幅上涨，乘客仍在继续预订航班。

达美航空押注旅客们将在今年假日季继续支付更高的机票价格，因为高收入客户愿意在高级座位上挥霍。

这家航空公司是首家公布财务业绩的大型航空公司，该公司表示，其航空燃油成本飙升了60%，第三季度较去年同期增加了16亿美元。燃油成本是航空公司第二大成本，仅次于劳动力成本。

但达美航空也表示，乘客支付的机票价格上涨了约 15%，尽管燃油成本上涨，但调整后的净收入仍增长了 2%。

“在我看来，利润没有受到影响简直不可思议，”首席执行官埃德·巴斯蒂安在周五早些时候公布第三季度业绩后接受CNBC采访时表示。“在过去的周期和冲击中，如果我们看到燃油价格上涨60%，我们就会彻底垮掉。”

巴斯蒂安表示，尽管票价大幅上涨，但航空旅行的需求依然强劲。他预计，这种强劲的需求和高票价的趋势将在今年剩余时间和明年持续下去。

“我们完全没有看到任何放缓的迹象。我们的消费者很有韧性，”他说。“票价将取决于市场承受能力。”

票价和收入的增长主要来自愿意为飞机上的高级座位付费的乘客，从经济舱的“舒适优选”和“优选经济舱”到头等舱和商务舱。高级座位的收入增长了18%。巴斯蒂安表示，收入排名前40%的家庭“基本上就是我们的客户”。

他说：“他们的首要任务是旅行。所以，从我们的角度来看，我们的高端产品越多，就越容易售罄。”

航空公司不能仅仅因为成本上涨就提高票价，除非乘客仍有出行需求。但燃油价格上涨确实会导致航空公司削减航班计划，取消那些即使在燃油成本飙升之前也几乎无利可图的航班。

尽管需求强劲，但刚刚结束的夏季旅游季，达美航空的可用座位数量与去年同期基本持平。面对强劲的需求，有限的座位数量导致整个季度86%的座位被预订一空，并推高了票价。

业内专家一致认为，今年剩余时间里，旅行需求强劲，票价也将持续上涨。旅游网站Hopper的首席经济学家海莉·伯格表示，今年乘客预订假期旅行的时间比往年更早，而且他们也愿意为此支付更高的费用。

“感恩节期间机票均价已达400美元，同比增长31%。”她在达美航空发布报告前告诉CNN，“圣诞节的机票价格通常比感恩节贵50美元左右，约为450美元，同比增长23%。”

今年早些时候，伊朗战争爆发后能源成本飙升，航空燃油价格从4月份的峰值大幅回落，但达美航空和其他航空公司并未降低票价。如今燃油价格已开始回升，巴斯蒂安表示，他预计燃油成本高企的局面将持续到第四季度。

达美航空的盈利略低于华尔街的预期，并下调了全年剩余时间的盈利预期。达美航空（DAL）以及几乎所有其他美国航空公司的股价在盘前交易中均小幅下跌。