Most major U.S. airlines made big bets on the resiliency of international travel last year, and the bets are going sour.
The initial reports on air traffic in January give a rough outline of a problem that will soon be obvious, because international traffic revenues are buoyed by premium fares in business class and first class.
By all anecdotal indications so far (although premium traffic is not broken out in the routine monthly operational reports), premium traffic on international routes is in a tailspin. Those $9,800 round trip business class fares over the Atlantic (OK, big companies supplying a lot of business could get them for $5,000) are history -- the $9,500 AND the $5,000.
Mike Boyd, the airline forecaster, refers to the international premium-fare collapse as a "neutron bomb" for domestic airlines that depend mightily on them.
Anyway, here are some of the January results (without any break-out of premium traffic, as I said):
--Delta, which has the most diverse routes over the Atlantic, and thus is at least somewhat insulated from the most severe downturn, in New York-London premium traffic: Delta's international traffic was up 6.6 percent in January (compared with January 2008) -- but on an increase in capacity of 11.3 percent.
(It was far worse domestically. Delta mainline domestic traffic was off 6.7 percent on an 8.5 percent capacity decrease. Regional routes were worse, with regional traffic off 14.4 percent on a 13.6 percent decrease in capacity.
--Northwest (which Delta, which acquired Northwest last year, still reports out separately): International traffic down 5.7 percent on a capacity decrease of 2.4 percent. Domestically, Northwest traffic was down 10 percent on a 9 percent decrease in capacity.
--American Airlines: Off 8 percent internationally with 2.8 percent fewer seats; off 13.9 percent domestically with 11.6 percent fewer seats.
Keep your eye on those international numbers as this slump deepens and travel demand continues to decline. The major airlines are very, very worried about that so-far not widely assessed bad trend.