Southwest Airlines has withdrawn its financial forecasts as the uncertainty from President Trump's trade war impacts airline revenues. With concerns over economic slowdown and inflation, travel spending is declining among consumers and corporations alike. Southwest highlighted challenges in predicting future profitability, specifically its inability to reaffirm projected earnings for 2025 and 2026. Other airlines such as Alaska Air Group and Delta have similarly adjusted their forecasts, indicating a broader trend of instability within the US airline industry, particularly affecting those that cater to price-sensitive leisure travelers in the domestic market.
Amid the current macroeconomic uncertainty, it is difficult to forecast given recent and short-lived booking trends.
With the trade war raising the prospect of slower economic growth and higher inflation, both tourists and corporations are sitting tight, leading to a pullback in travel spending.
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