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Delta Rakes in Q2 Revenue Despite a Smaller Pilot Workforce

Delta has added 18,000 workers since the beginning of 2021. [Courtesy: Delta]
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Key Takeaways:

  • Delta Air Lines reported Q2 revenue 10% higher than pre-pandemic 2019, despite carrying 15% fewer passengers, but continues to face an ongoing labor shortage, particularly for pilots.
  • The airline's current pilot issues stem from offering early retirement inducements to nearly 2,000 senior pilots in 2020, a decision CEO Ed Bastian now admits may have overestimated the need for downsizing.
  • While Bastian is confident Delta will resolve its pilot staffing by mid-decade, analysts predict a worsening industry-wide pilot shortage of up to 26,000 by 2030, though Delta is considered least exposed.
  • Delta's biggest immediate challenge is not hiring, but overcoming the "training and experience bubble" for new employees, which is a bottleneck for fully restoring passenger capacity by summer 2023.
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Delta Air Lines [NYSE: DAL] reported Wednesday that its second quarter revenue of $13.8 billion for this year was 10 percent better than the same period in pre-pandemic 2019, a year the airline was named the largest in the world based on revenue. Interestingly, the airline’s recent earnings boost comes despite carrying fewer passengers—15 percent fewer—than it did on average in 2019. Yet, analysts on the company’s earnings call had another thing atop their minds: Delta’s pilot and ongoing labor shortage. 

Despite adding 18,000 workers since the beginning of 2021, Delta CEO Ed Bastian said company-wide employment participation was still at 95 percent of 2019 capacity. Still, travel has been smooth for the airline this summer. Bastian said pilots, mechanics, and flight attendants are still needed, but that there would be a slowdown in hiring workers for gate and customer service positions in airports as well as reservations, because it was closing in on its staffing targets for these positions.

Michael Wildes

Michael Wildes holds a master’s degree in Logistics & Supply Chain Management, and a bachelor’s degree in Aeronautical Science, both from Embry-Riddle Aeronautical University. Previously, he worked at the university’s flight department as a Flight Check Airman, Assistant Training Manager, and Quality Assurance Mentor. He holds MEI, CFI & CFII ratings. Follow Michael on Twitter @Captainwildes.

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