Glen Hauenstein, president of Delta Air Lines, stated on Thursday that recent strikes by United Auto Workers union members and Hollywood celebrities are a “drag” on the otherwise recovering demand for business travel.
According to airport data, Delta has a disproportionately large exposure to the automotive & entertainment industries, with a market share of more than 70% at Detroit Metropolitan Wayne County Airport and approximately 20% at Los Angeles International Airport, higher than any other carrier.
In addition to the UAW strike, which has significantly reduced business in Detroit, the strikes have “had a not insignificant impact on the business travel to and from Los Angeles,” according to Hauenstein, who made the statement on a Thursday earnings call. “Those two sectors probably have the biggest impact on us.”
Targeted strikes by the United Auto Workers, which started when significant Detroit automakers and the union were unable to reach a labor agreement before a contract expiration in September, are now in their fourth week and are intensifying.
Hollywood writers approved a new three-year contract earlier this week, ending a nearly 150-day work strike that halted a large amount of film and television production.
However, the American Federation of Television and Radio Artists and the Screen Actors Guild, which represent actors in Hollywood, are still on strike. The Alliance of Motion Picture and Television Producers, which includes production companies like Disney, Universal, Netflix, and others, also said late on Wednesday that negotiations have been paused since the two parties are at a standstill on a settlement.
According to Delta’s Hauenstein, the third quarter saw a double-digit rise in demand from customers in the financial and technology sectors, which helped business travel recover overall.
According to a business survey of corporate clients, most anticipate that their travel will either remain the same or increase in the final three months of this year and into 2024, according to Hauenstein.