Delta Air Lines reported a loss of approximately $200 million due to the longest government shutdown in U.S. history, as shared by CEO Ed Bastian. This was the first insight from a U.S. airline into the financial fallout from the shutdown.
Bastian noted that Delta’s earnings fell by around 25 cents per share, with a notable decline in bookings and a significant rise in customer refunds. The 43-day shutdown introduced uncertainty in air travel, causing delays at major airports and historic flight cancellations at 40 of the busiest locations, partly due to unpaid air traffic controllers missing work as they sought secondary employment. As this shutdown extended into its second month, the Federal Aviation Administration (FAA) issued an emergency order, mandating commercial airlines to cancel up to 6% of domestic flights. Transport Secretary Sean Duffy explained that this measure was vital to maintaining safe travel.
“It’s quite unusual for the Secretary of Transportation to communicate that there are insufficient air traffic controllers and to cast doubt on the safety of certain flights,” Bastian remarked, indicating that this had contributed to a decrease in vacation bookings.
Between November 7 and 16, over 10,000 flights were canceled following the FAA’s intervention, just before the busy Thanksgiving travel season.
Bastian expressed that the effects of the shutdown were anticipated but also indicated that Delta had a robust Thanksgiving week and that end-of-year bookings looked promising, especially around Christmas and New Year’s. “We made it through, though it felt like a temporary hurdle,” he said, looking ahead to a positive December.
The shutdown imposed restrictions on major hubs, including airports in New York, Chicago, Los Angeles, and Atlanta. Initial flight reductions started at 4% but increased to 6%, then returned to 3% after the shutdown ended on November 12, thanks to improvements in air traffic controller staffing.
During the shutdown, federal employees, including air traffic controllers, worked without pay and missed two salary checks. President Trump took to social media, urging controllers to “get back to work now!!!” and proposed $10,000 bonuses for employees who remained in their positions while also suggesting severance for those who didn’t.
On Wednesday, Senator Tammy Duckworth, who is the ranking member of the Senate Aeronautics, Space, and Innovation Subcommittee, sent a letter to Duffy urging equitable bonus distribution for all remaining FAA employees. “It’s unfair to penalize federal workers who carried on without pay while facing challenges beyond their control,” she commented.
Duffy had not responded to the letter by Wednesday but had previously stated his understanding of the hardships faced by air traffic controllers during a news conference before Thanksgiving. However, he reiterated the necessity of ending bonuses, comparing it to rewarding a student who scores perfectly on a test with a small sticker, while ensuring that all air traffic controllers and technicians would receive their full back pay.
