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Not much Omicron effect on domestic flight bookings: BofA

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·2 min read
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With the Omicron variant surging across the U.S. — the variant now comprises 73% of new U.S. COVID-19 cases — experts are concerned about how the rise in case numbers will affect the travel industry amid the holiday season. According to a Dec. 20 Bank of America Global Research (BAC) report, however, Omicron has not had much of an effect on domestic flight bookings just yet.

“Domestic bookings have been largely resilient in the face of omicron thus far with more softness in international bookings,” BofA Global Research’s report reads. “[Delta (DAL)] confirmed these trends at its investor day last week as the carrier cited strong holiday demand (similar trends seen by [Southwest (LUV)]) but has seen some impact on international demand due to travel restrictions.”

According to the report, after seeing an impact on bookings data due to omicron last week, domestic and international tickets sold rebounded to down -13.2% from 2019 (vs. -18.9%) and down -37.6% from 2019 (vs. -41.4%), respectively. BofA forecasted that the recent increase in COVID-19 case counts could hurt bookings beyond the peak holiday season into the beginning of 2022, however.

“While domestic bookings are in line with pre-holiday levels of -13%, international bookings remain below the pre-holiday levels of down -27%,” the report reads. “Domestic leisure bookings (tickets sold through OTA channels) stepped up to down -2.5% vs 2019 (vs -9.0% last week), but remains below 2019 levels two weeks in a row.”

Other metrics for the airline industry demonstrated an upside as Delta, American (AAL), United (UAL), Spirit (SAVE), and Hawaiian (HA) all saw sizable increases in website visits — U.S. airlines’ trailing seven-day site visits grew 15% for the week ending Dec. 14 compared to 7% last week. In addition, corporate bookings through large travel agencies improved to down -35.0% against -39.7% last week, which BofA noted was the “best week” for corporate bookings since the pandemic started (aside from an irregular hurricane week).

“While the continued improvement of corporate demand, especially through large channels, is encouraging, the last two weeks of December (this week and next week's data) are historically the weakest bookings period for corporate,” the report noted.

Headlines are not as optimistic abroad and for business travel, however, as new figures have shown a drop in business travel trips as restrictions tighten. For instance, data from Travelogix and the Global Business Travel Association (GBTA) showed 22,452 fewer U.K. business travel trips in the second week of December compared to the first week of the month, largely as a result of omicron and the ensuing restrictions.

Thomas Hum is a writer at Yahoo Finance. Follow him on Twitter @thomashumTV

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