By coinnews 
00:00 Speaker A
American Airlines joining Delta Airlines and Southwest Airlines and withdrawing full-year guidance amid heightened economic uncertainty. Americans domestic travel demand under pressure in the first quarter, while Southwest announced it will reduce its capacity in the second half of the year, pointing to that softer domestic demand. Here with more on travel demand, we’ve got Scott Keys, who is the founder and chief flight expert at Going, formerly known as Scott’s Cheap Flights. Great to have you here with us. So, just take us into your analysis of what we’ve heard from the airlines and what that spells for the summer travel season now that we’re past most of everybody’s spring break travels.
01:36 Scott Keys
Sure. Look, airlines, like much of the rest of the economy right now, are flying blind, and when you’re a pilot, when you’re an airline, you do not want to be in that position. You’ve seen so many different airlines pulling their guidance, not just the ones you mentioned, also Alaska Airlines as well, and United coming out with two different forms of guidance depending on what type of macroeconomic environment we find ourselves in. So they’re in a difficult position right now because while the bottom hasn’t fallen out and travel today, what they’re worried about is will it really start to soften in the upcoming months, especially in those summer months that are such a cash cow for the airlines that are essentially the airlines Black Friday. So there’s fears in the travel industry of what this period of economic anxiety and uncertainty could mean for the discretionary spending category of travel.
03:19 Speaker A
And so with that, how are we anticipating that consumers will either pull back on some of that spending and ultimately, what type of destinations might receive the most demand as consumers are also trying to figure out, okay, where can we continue to spend into that travel experience versus where should we moderate or trade down some of that travel experience?
04:02 Scott Keys
I think you’re going to see a lot more trading down this time versus previous recessions, but it might look different than previous recessions. So, think back to 07-08. Some of the big winners in that ones were the budget airlines. Think Spirit Frontier that have all had years long expansions at that point and continued to. But nowadays, it’s the budget airlines that are in real trouble, and it’s the full-service airlines like Delta and United that come in from a position of strength. So while they might be seeing fewer of their business class and premium seats being sold, I think you’re going to see a lot of those folks, like you said, trading down to economy or economy plus on the full-service airlines. And in fact, it’s the budget airlines that have seen the biggest hit over the past month. Frontier Airlines stock down nearly 50% in the past month. Just a remarkable drop, and I think that speaks to a different landscape than we’ve seen historically. But in terms of destinations, you know, look, you’ve seen such a talking point of the drop in foreign arrivals to the United States, whether because of tight finances or because of folks getting detained at the border, or just nationalist sentiment with the trade war, and that means many fewer empty seats on flights to and from Europe, to and from Canada, which what do airlines do when they have those empty seats? They cut the price. You know, we’ve seen record lows on flights like, for instance, right now in the summer, Atlanta to Vancouver for $129 round trip. That’s something that would usually cost over $500. Flights from Minneapolis over to Iceland for $460 nonstop round trip. Dallas to Amsterdam under $600 nonstop round trip in all in the summertime. Those are deals that really kind of underscore a softening in travel that the airlines are seeing.
07:16 Speaker A
And so, all of these in mind, I want to get to some of the tips here for flyers, passengers, travelers who are still trying to get the best bang for their buck for their summer travel season.
07:40 Scott Keys
Couple things that you can do. First, target the beginning and the end of summer as the cheapest dates to fly. So, first two weeks of June, but especially the last two weeks of August. That’s when you’re most likely to see great deals popping up, and when you can see prices 30, 40% lower than that middle of summer period. Second, you know, getting the timing of your booking right is so important to getting a cheap flight. Right now is when we’re at the end of what I would call the typical Goldilocks window period for when you’re most likely to see cheap summer flights. This is not a typical year. I think we’re much more likely to see last-minute fair drops than we have in years prior, given the kind of economic landscape that we find ourselves in. And then finally, if you are sitting on a stash of frequent flyer miles, expect to be able to use those for great value this summer. Not only are they usually at their best value for those last minute flights, but again, with many more unsold seats coming into this summer, that’s those are the seats that airlines typically release to award availability in the final weeks before a flight. If you can hold out, you’re really, really good odds this year of get being able to get great value for those miles.
09:33 Speaker A
Scott, I only got about 30 seconds left here. On the international travel front, how should travelers prepare for the reality of exchange rates with the weakening dollar as of right now?
09:53 Scott Keys
Yeah, look, the dollars go, you know, it’s down anywhere from 5 to 15% over the past few weeks, still a lot higher than it was, you know, even a decade ago. For folks who are traveling to Europe or Japan, expect things to be cheaper than you were there last time, even if it’s a bit more expensive than it was a month or two ago.
10:25 Speaker A
Scott, great to have this conversation. Thanks so much for joining us and bringing us some very valuable tips for our summer travel plans. Appreciate it.
10:37 Scott Keys
My pleasure. Thanks, Brad.