America’s top airlines keep talking about the ‘capacity’ crisis. Here’s what they’re sayingo
Last month, Deutsche Bank warned investors that America’s airlines would start cutting the number of flights they run and the destinations they serve as supply began to overpower demand and drive down pricesThis past week we observed one of the industry’s largest week-over-week capacity reductions as carriers removed almost a point of growth from December quarter schedules,” Michael Linenberg, an analyst at the bank covering airlines, wrote in a note to clients after he and his team realized that year-over-year growth in the number of expected “available seat miles” — space for one passenger to be flown one mile — fell nearly a full point to 4% from 4.8% for the last quarter of the year.
Check out what America’s 10 largest airlines are saying about the issueOn the company’s July 30 earnings call, chief revenue officer Brent Overbeek said that second-quarter revenues were steady. But trouble looms on the horizon.For the third quarter, we expect overall system [revenue per available seat mile] to be down about 3% year-over-year on capacity growth of about 7%,” he said. “We are seeing discounting as well. We’re seeing more discounting as supply outstrips demand in both North America and in Japan
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