Description

Providing the most comprehensive and up-to-date information and analysis of the US Airlines domestic market including the behaviors, preferences, and habits of the consumer.

Current Market Landscape

What may seem nearly unfathomable before the pandemic, just 57% of air passengers today list low fare prices as one of their top three factors in choosing a particular flight. This statistic indicates that the cessation of air travel has given passengers time to reassess their values when it comes to air travel and the features that would be worth paying more for. There are indications that flyers are seeing air travel less as a simple means of transportation and more as a travel experience in and of itself. Improving the flying experience can be difficult for airlines given the numerous constraints on the industry, but by looking at the desires of emerging demographics, airlines can find ways to stand out.

Read on to discover more about US Airlines market research, read our US COVID-19 Impact on Travel: One Year Later | Market Report 2021, or take a look at our other Holidays and Travel Market research reports.

Quickly understand

  • The impact of COVID-19 on consumer behavior and the domestic air travel market and domestic airlines industry.
  • The consumer demands that have persisted through the current phase of the pandemic.
  • When consumers plan on flying worry-free and what their expectations from airlines will be.
  • How airlines can update and diversify their offerings to meet emerging demands.

Covered in this report

Brands include: Facebook, Deutsche Bahn, Airbus A220, Heart Aerospace.

Airlines include: American, Delta, United, Southwest, JetBlue, Frontier, Spirit, Breeze, Frontier, Mesa, Emirates, Cathay Pacific, easyJet, Lufthansa, Avelo, Aha!.

Expert analysis from a specialist in the field

This Aviation Market Research report, written by Mike Gallinari, a leading analyst in the Travel and Leisure sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

Commercial air travel’s recovery has begun, boosted by the rollout of COVID-19 vaccines. The rebound phase will carry into the spring and summer of next year, after which airlines will need to transition into a ‘post-pandemic’ strategy. This next normal will hinge not only on improving the passenger experience but also how airlines treat their employees and the environment.
Mike Gallinari, Travel & Leisure Analyst
Mike Gallinari
Travel and Leisure Analyst

Table of Contents

  1. Overview

    • What you need to know
    • This Report looks at the following areas:
    • Definition
    • Market context
    • Economic and other assumptions
    • COVID-19: US context
  2. Executive Summary

    • Top takeaways
    • Market overview
      • Figure 1: Total US sales and fan chart forecast of airlines, at current prices, 2016-26
      • Figure 2: Flights in the past 12 months, 2021
    • Impact of COVID-19 on travel and airlines
      • Figure 3: Short-, medium- and long-term impact of COVID-19 on travel and airlines, 2021
    • Challenges
    • Values speak louder than loyalty perks to young flyers
      • Figure 4: Differentiators in airline choice, by age group, 2021
    • LCCs are gaining appeal for business and high-frequency travelers
      • Figure 5: Opinions of carriers for flight lengths, by flight frequency and by business travel, 2021
    • Young flyers aren’t impressed with in-flight offerings
      • Figure 6: Attitudes toward in-flight offerings, by age group, 2021
    • Opportunities
    • Spring 2022 looks to be the breakout
      • Figure 7: Future travel plans, 2021
    • Price isn’t the be-all end-all factor
      • Figure 8: Top flight choice factors, 2021
    • Profitable flying segments are open to alternatives
      • Figure 9: Attitudes toward transportation options, by flight frequency and by business travel, 2021
  3. The Market – Key Takeaways

    • Airlines have bounced back, but have a way to go
    • Airfare and Other revenue will be a greater share of total revenue
    • In-flight policies and behaviors can dictate airline choice
    • Delta variant, inflation, lead to nervous consumers
  4. Market Size and Forecast

    • Vaccines jumpstarted airlines’ recovery
      • Figure 10: Total US sales and fan chart forecast of airlines, at current prices, 2016-26
      • Figure 11: Total US sales and forecast of airlines, at current prices, 2016-26
    • Impact of COVID-19 on airlines
    • Concern about exposure trending up, but that may not matter
      • Figure 12: Coronavirus exposure concern, 2020-21
    • Delta variant may spur vaccinations
      • Figure 13: Vaccination outlook, 2021
  5. Segment Performance

    • Fares will likely stay elevated
      • Figure 14: Total US sales of airfare, at current prices, 2016-26
    • More luggage means baggage fees will be a larger share of revenue
      • Figure 15: Total US sales of baggage fees, at current prices, 2016-26
    • Rescheduling fees may be on their way out
      • Figure 16: Total US sales of cancellation and change fees, at current prices, 2016-26
    • Improving the flying experience will drive Other revenues
      • Figure 17: Total US sales of other revenue, at current prices, 2016-26
  6. Market Factors

    • Confidence in masked flying holding steady
      • Figure 18: Mask safety, 2021
    • Countries aim to cooperate to strengthen global tourism
    • Alcohol comes under scrutiny by Congress
    • Northeastern Alliance criticism can make mergers harder
    • Biden aims to reduce airline emissions by 2030
    • Unemployment falling, but travel struggles
    • Bad behavior can make hiring difficult
      • Figure 19: Unemployment and underemployment, 2007-21
    • Consumer confidence takes a hit due to economic concerns, COVID-19 resurgence
      • Figure 20: Consumer Sentiment Index, 2010-21
    • A host of issues may make travelers consider driving despite fuel prices
      • Figure 21: US gasoline and diesel retail prices, 2007-21
  7. Companies and Brands – Key Takeaways

    • Airline industry players are recovering together
    • Desktop ads provide the best CPI value
    • Airlines are changing their identity abroad
  8. Market Share

    • Recovery is happening across the board
      • Figure 22: Passengers, operating revenue and net income for major US carriers, 2019-21
  9. Domestic Strategies

    • Marketing strategies
    • You get what you pay for
      • Figure 23: Share of spend and impressions for digital advertising of major American carriers, 2020-21
    • Desktop display provides the best value in terms of reach
      • Figure 24: Difference between share of spend and share of impressions for digital advertising of major American carriers, 2020-21
    • Carrier strategies
    • American extends AAdvantage to third-party bookers
    • Breeze and other newcomers put smaller cities in the spotlight
    • United swings big on untested tech
    • Southwest throws down the gauntlet in the Pacific
  10. Strategies Abroad

    • Emirates Pay could reshape loyalty
    • Cathay diversifies to stay relevant
    • easyJet rail expansion facilitates air-ground relationship
  11. The Consumer – Key Takeaways

    • Recovery is still vaccine-dependent
    • Passengers aim to return in 2022
    • The fare wars have subsided – for now
    • COVID-19 protocols may be waning in importance
    • Consumer opinion reveals weak spots in airline offerings
    • Airlines need to crack down on unruly passengers
    • The pandemic has swung favorability to booking direct
    • In-flight offerings need an upgrade
    • Airlines need to go green
  12. Flying in the Past 12 Months

    • Air travel’s current recovery is just beginning
      • Figure 25: Flights in the past 12 months, 2021
    • Casual flyers are flying less frequently
      • Figure 26: Number of flights in the past 12 months, 2018, 2020, 2021
    • COVID-19 determined many flight preferences
      • Figure 27: Types of flights in the past 12 months, 2021
    • Vaccines made people willing to travel
      • Figure 28: Timing of flights in the past 12 months – COVID-19 vaccine, by age and by household income, 2021
  13. Future Flight Plans

    • Better days are ahead
      • Figure 29: Future travel plans, 2021
    • Income is a primary determinant for willingness
      • Figure 30: Future travel plans, by age group and HHI, 2021
    • Spring is an important time for Black and Asian flyers
      • Figure 31: Future travel plans, by race and Hispanic origin, 2021
  14. Flight Choice Factors

    • Low fares aren’t the be-all and end-all
      • Figure 32: Top flight choice factors, 2021
    • Travelers under age 35 are driving the shift away from low fares
      • Figure 33: Top flight choice factors, by age group, 2021
    • Importance of airfare and direct flights increases with age
      • Figure 34: Most important flight choice factor, by age group, 2021
    • Efficiency can lead to revenue
      • Figure 35: Top flight choice factors, by HHI, 2021
  15. Airline Differentiators

    • COVID-19 policies are a concern, but in a new way
      • Figure 36: Differentiators in airline choice, 2021
    • Start building loyalty among young travelers
      • Figure 37: TURF Analysis – Airline choice, 2021
    • For young adults, loyalty is about identity
      • Figure 38: Differentiators in airline choice, by age group, 2021
  16. Opinions of Carriers

    • Legacy airlines struggle in flights under three hours
      • Figure 39: Opinions of carriers for flight lengths, 2021
    • Frequent and business travelers could turn to LCCs for long flights
      • Figure 40: Opinions of carriers for flight lengths, by flight frequency and by business travel, 2021
    • ULCCs need to improve service to compete
      • Figure 41: Opinions of carriers for customer service, 2021
    • Carriers have room to improve their business services
      • Figure 42: Opinions of carriers for customer service, 2021
    • Direct innovation toward upgrades and environmentalism
      • Figure 43: Opinions of carrier identity, 2021
  17. Attitudes toward Handling Passengers

    • Carriers need to have consequences for bad behavior
      • Figure 44: Attitudes toward handling passengers, 2021
    • Codes of conduct are necessary to keep business travelers happy
      • Figure 45: Attitudes toward handling passengers, by flight frequency and by business travel, 2021
    • Rules of conduct can instill confidence in wary Black and Asian travelers
      • Figure 46: Attitudes toward handling passengers, by race and Hispanic origin, 2021
    • Wealthier passengers demand better conduct
      • Figure 47: Attitudes toward handling passengers, by HHI, 2021
  18. Attitudes toward Flight Planning and Booking

    • Carriers are positioned well against OTAs
      • Figure 48: Attitudes toward planning and booking, 2021
    • Black flyer needs are an industry blind spot
      • Figure 49: Attitudes toward airlines’ role in travel concerns, by race and Hispanic origin, 2021
    • All income levels would welcome a degree of personalization
      • Figure 50: Attitudes toward planning and booking, by HHI, 2021
    • Catering to frequent and business travelers remains important
      • Figure 51: Attitudes toward planning and booking, by flight frequency and by business travel, 2021
  19. Attitudes toward In-flight Offerings

    • Screen preferences move away from the seat back
      • Figure 52: Attitudes toward in-flight offerings, 2021
    • In-flight experience demands have arrived
      • Figure 53: Attitudes toward in-flight offerings, by age group, 2021
    • Airlines compete with airport restaurants, but don’t have to
      • Figure 54: Attitudes toward in-flight offerings, by HHI, 2021
    • Workcationing brings more playful demands to business travel
      • Figure 55: Attitudes toward in-flight offerings, by flight frequency and by business travel, 2021
  20. Attitudes toward Transportation Options

    • There’s lots of hope for changing existing travel methods
      • Figure 56: Attitudes toward transportation options, 2021
    • There are many versatile options for travel tech
      • Figure 57: Attitudes toward transportation options, by age, 2021
    • Changing work conditions may force airlines to diversify
      • Figure 58: Attitudes toward transportation options, by flight frequency and by business travel, 2021
  21. Appendix – Data Sources and Abbreviations

    • Data sources
    • Forecast
    • Consumer survey data
    • Abbreviations and terms
    • Abbreviations
  22. Appendix – The Market

      • Figure 59: US passenger airline operating revenue and forecast, at current prices, 2016-26
      • Figure 60: US passenger airline operating revenue and forecast, at inflation-adjusted prices, 2016-26
      • Figure 61: US passenger airline airfare revenues and forecast, at current prices, 2016-21
      • Figure 62: US passenger airline airfare revenues and forecast, at inflation-adjusted prices, 2016-21
      • Figure 63: US passenger airline baggage fee revenues and forecast, at current prices, 2016-21
      • Figure 64: US passenger airline baggage fee revenues, at inflation-adjusted prices, 2016-21
      • Figure 65: US passenger airline change/cancellation fee revenues, at current prices, 2016-21
      • Figure 66: US passenger airline change/cancellation fee revenues, at inflation-adjusted prices, 2016-21
      • Figure 67: US passenger airline revenues from other sources and forecast*, at current prices, 2016-21
      • Figure 68: US passenger airline revenues from other sources*, at inflation-adjusted prices, 2016-21

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