Air Travel Delays on the Rise

It has been a busy summer for air travel, with an unfortunate increase in flight delays. According to flight-tracker FlightAware, between May 1 and August 29, about 24% of flights in and out of the U.S. experienced delays. A delayed flight is defined as missing its scheduled arrival time by 15 minutes or more. On average, these delays lasted for 55 minutes, compared to 52 minutes in 2022.

Punctuality Rankings

Based on FlightAware data, Delta Air Lines takes the lead as the most punctual major airline this year, with only 20% of its flights experiencing delays. Alaska Air follows closely behind with a delay rate of 21%. American Airlines, despite being hit with a record $4.1 million fine recently for keeping passengers on planes on the tarmac for more than three hours, ranks third with a delay rate of 25%. United Air Lines and Southwest Airlines both have a delay rate of 26%.

Trailing behind the pack, Frontier Group experiences delays in 35% of its flights, while JetBlue Airways and Spirit Airlines see delays in 33% and 32% of their flights, respectively.

Southwest’s Turnaround

Southwest Airlines started off 2023 with a holiday travel meltdown, resulting in a $325 million revenue loss in the first quarter. However, the airline implemented an action plan and managed to complete over 99% of its flights in the second quarter. Southwest claims that this performance is its best in the past 10 years.

Passenger Satisfaction Takes a Dive

While delays are certainly frustrating, it is airfares and fees that have caused a decrease in passenger satisfaction for the second year in a row, according to J.D. Power. The good news, however, is that airline fares have been on the decline. In July, fares fell by 8.1% compared to June, marking the fourth consecutive monthly decline and an 18.6% decrease compared to the previous year.

Recent Market Movements

In other news, stock markets in China experienced another drop, with China Evergrande losing 80% of its value. Additionally, Country Garden requested a delay on a debt payment. Meanwhile, manufacturing in China contracted for the sixth consecutive month. In response, China’s central bank took action by cutting mortgage rates and providing support for the yuan.

In the U.S., job openings and consumer confidence both declined in July. However, consumer spending increased, and core inflation showed signs of slowing down. August job growth also slowed, reducing concerns about potential rate hikes. Overall, stock markets had a positive week, with the Dow Jones Industrial Average rising by 1.4%, the S&P 500 by 2.5%, and the Nasdaq Composite by 3.3%.

Companies

• 3M settles with 250,000 veterans for $6 billion over faulty combat earplugs.
• Toyota halts production at 14 facilities due to a computer-processing system breakdown.
• UBS reports record quarterly earnings of $29 billion.

Deals

• Goldman Sachs sells its investment advisory business to Creative Planning for $29 billion.
• Danaher acquires protein and antibody maker Abcam for $5.7 billion.
• Hedge fund Millennium Management shorts Carlos Slim’s telecom America Movil for $320 billion.

Next Week

Monday 9/4

• Equity and fixed-income markets closed for Labor Day.

Wednesday 9/6

• Danaher hosts investor day to discuss Veralto spinoff.
• The Institute for Supply Management releases Services Purchasing Managers’ Index for August.