Summary
- The Olympics in Paris are affecting Delta’s profit margins, as travelers avoid the city until after the games.
- Around 2 million overseas visitors are expected for the Olympics in Paris, but traditional leisure demand lags.
- Delta’s summer schedule is still strong, with record US tourists heading to Japan due to favorable exchange rates.
The official airline sponsor of Team USA for the 2024 Olympics is set to lose money this summer as a result of the games. According to Delta Air Lines CEO Ed Bastian, leisure travelers are avoiding Paris this summer, and the airline is set to suffer for it.
Why are people avoiding Paris?
The Olympic and Paralympic Games are set to begin in Paris later this month, with events running from July 26th to August 11th. According to local media outlet Le Monde, around 15 million visitors are expected to attend the ceremonies. Yet, the vast majority of travelers will not be flying in, with only two million expected to arrive from overseas.
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Delta Air Lines and its partner Air France will operate the most transatlantic flights to the US this summer. According to data from Cirium, the SkyTeam Alliance carriers will operate 1,654 flights between the two countries during the Games, representing almost half a million available seats.
This year, however, the Olympics are hampering the carrier’s typically busy season. Speaking to CNBC, Delta Air Lines CEO Ed Bastian confirmed that passengers not attending the Games are not flying to Paris in the numbers customarily seen at this time of year:
“Unless you’re going to the Olympics, people aren’t going to Paris … very few are.
“Business travel, you know [remains strong], [but] other type of tourism is potentially going elsewhere.”
Photo: Parkdolly | Shutterstock
Delta signed a multi-year deal to become the official airline of Team USA for the Olympic and Paralympic Games Paris 2024, the Olympic and Paralympic Winter Games Milano Cortina 2026, and the Olympic and Paralympic Games Los Angeles 2028. It celebrated this sponsorship with a special aircraft livery this summer following its design in 2022.
Bookings are lagging across the board
Delta partner Air France-KLM confirmed the group has seen summer season revenues dip between €160-180 million ($174-194 million) due to the upcoming Olympic Games in Paris. Traffic to and from the French capital lags behind other major European cities. Travel between Paris and other destinations is also below the usual June-August average as travelers appear to be postponing their holidays until after the Olympic Games or considering alternative travel plans, with the airline noting:
“International markets show a significant avoidance of Paris.”
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Speaking to Le Monde, Corinne Menegaux, the Director of the Paris Tourist Office, shared that air arrivals in Paris are down by 15% compared with the same period in 2023, as people steer clear of the city until the reveling crowds dissipate:
“People are postponing their plans or coming for the Olympics. We have fewer Americans in Paris at the moment, but they are the main foreign visitors who will be here during the Games.”
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All is not lost for Delta Air Lines, which is offering its most extensive summer transatlantic schedule to date. At the quarterly earnings call, Delta President Glen Hauenstein noted that leisure demand to Europe from September through November remains strong “across the board” and noted an interesting emerging destination thanks to favorable exchange rates for US travelers:
“We have really record numbers of US tourists heading to Japan, which is such a great destination.”
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