United Airlines Hoping Premium Travel Demand Will Carry It Through Economic Turbulence

Spring break 2025 travel trends amid US inflation

As inflation remains a concern for the U.S., Americans looking to take a vacation are choosing new destinations and experiences to save money.

• United Airlines predicts resilient financial performance despite economic concerns.
• Demand for premium and international travel contributes to positive outlook.
• Tariffs and trade tensions create a challenging economic environment for airlines.

United Airlines said on Wednesday it expects its financial performance to remain resilient despite economic uncertainty stemming from new tariffs, citing demand for high-margin premium offerings and international travel.

"Regardless of the economic path ahead, we expect our financial results to be resilient," Chief Financial Officer Michael Leskinen said on Wednesday.

Trump's trade policies and sweeping tariffs have sparked a global trade war and increased the possibility of a global recession, making customers hesitant to spend on travel.

Expectations of a gloomy demand environment have prompted airlines to take a prudent approach with capacity and cost controls. Several U.S. airlines are cutting flights to avoid lowering fares and to protect margins.

The economic downturn is creating headwinds for major U.S. airlines, which, just two months ago, were benefiting from strong travel demand and solid pricing across their networks.

However, airlines with an extensive premium presence have limited some of the impact.

United on Tuesday reported better-than-expected first-quarter earnings and said forward bookings for high-margin premium cabins rose 17% over the past two weeks, with international reservations up 5% during that period.

"So far we've seen no deterioration in high-end consumers' willingness to purchase a premium experience," Chief Commercial Officer Andrew Nocella said on the company's earnings call.

But United also warned the forecast was dependent on the macro environment, which it added was "impossible to predict this year with any degree of confidence."

Contributing: Rajesh Kumar Singh, Reuters