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European airlines report stable transatlantic demand amidst US trade tensions

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European airlines report stable transatlantic demand amidst US trade tensions
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Luis Gallego CEO of International Airlines Group | Official Website

European airlines have reported stable demand for transatlantic travel despite ongoing political and trade tensions related to recent US policies. Major European airline leaders remain cautious, however, about the potential impacts.

Monitoring the situation, CEOs from Europe's leading airline groups, including Air France-KLM’s Benjamin Smith, International Airlines Group (IAG) CEO Luis Gallego, and Lufthansa Group’s Carsten Spohr, have acknowledged that current bookings between Europe and the US are meeting expectations. This observation was made during the A4E Aviation Summit held in Brussels.

Smith mentioned there has been no noticeable impact on European airlines or their American counterparts, describing the stance as “concerning” and highlighting that the situation is being closely watched. Gallego agrees, stating that the Trump administration has yet to affect its markets negatively. Spohr added that expectations for the summer of 2025 predict an unprecedented increase of passengers on transatlantic routes.

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In contrast, there has been a significant decline in bookings between the US and Canada, partly due to tensions involving tariffs and political rhetoric. Travel data from OAG shows a steep drop by as much as 75% in bookings between the two countries. This trend is attributed to uncertainty surrounding ongoing trade disputes.

In response to declining demand, Air Canada has adjusted its operations by reducing flights to the US and using smaller aircraft on certain routes. The adjustments are based on decreased travel activity, primarily expected in July and August.

According to the US Travel Association, Canadian visitors were a significant part of international tourism to the US, with 20.4 million trips in 2024 contributing $20.5 billion and supporting numerous jobs. Concerns have been raised about potential revenue declines in retail and hospitality sectors, particularly in the most visited US states by Canadians, including Florida and California.

Overall, while European airlines continue monitoring transatlantic demand, Canadian-US travel faces a more substantial impact due to current geopolitical tensions.

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