Summary Q2 2024 profits were lower than Q2 2023 profits. Various segments of tourists (such as VFR) are avoiding Paris due to the Paris Olympics. The Paris Olympics negatively impacted Air Canada and other airlines, including Delta Air Lines and Air France.
Air Canada announced its financial performance results for the second quarter (Q2) of 2024 and noted weaker profits compared to those of 2023. The airline cited lower numbers this time around due to stagnant travel demand and a reduction in sales within the airline's European network due to events such as the Olympics. Because of the Olympics? Yesterday, Air Canada reported its earnings for Q2 2024, during which the airline made a profit of $339 million from its revenue of $4 billion.
However, compared to data from Q2 2023, the airline's profits decreased this year. Q2 2024 Q2 2023 Change Revenue ($ million) 4,014 3,947 +1.6 % Profit ($ million) 339 583 -42 % Operating Margin (%) 8.
4 14.8 -43.2 % While it is reported that the general passenger demand has stagnated, Quartz also reported that Air Canada considers the Paris Olympics to have a negative impact on the airline's profits.
Reports suggest that potential customers who would not be interested in attending the Olympics in person are avoiding Paris because of all the rush in and around the city associated with the event. While business/corporate travel will not be impacted much, other segments of travelers, such as VFR (Visiting Friends and Relatives), will be severely impacted, as passengers would not prefer to fly during this time due to high ticket fares and hotel fares in and around Paris being expensive due to the Olympics. Furthermore, the airline also stated that prior to the Olympics, the Euro Tournament, which took place in Germany, also resulted in various segments of tourists avoiding flying to Germany during that period.
Simple Flying has reached out to Air Canada to know what their forecast is for the next two quarters of the year. Any response received will be updated into the article. Not just Air Canada The financial hit by tourists avoiding Paris due to the Olympics is affecting not only Air Canada but other airlines as well.
The US-based giant Delta Air Lines , earlier this month, reported that the airline expects to lose around $100 million this summer due to the Olympics, citing tourists not wishing to fly to France. Tourists are shying away from the City Of Lights this month as travelers typically headed to Paris postpone their trips till after the Games. Across the Atlantic, Delta's European partner, Air France , is also expecting their revenue to drop by $172 million to $194 million.
Meanwhile, other carriers, such as Emirates, have already issued travel advisories for passengers looking to travel to Paris: "Due to the Summer Olympics 2024 and Paralympic games 2024 in Paris, roads in the city will be congested. Some areas around the Olympic village and sport facilities will have restricted access." The airline also advises its customers to access the relevant website to ensure they can gain access to their destination within the Paris area.
Expanding network and fleet Despite the reduced profits and lower profit margin, Air Canada is in the process of expanding its route network and adding capacity to its fleet. Just a month ago, the airline acquired eight new Boeing 737 MAX 8s on lease from BOC Aviation, which will be delivered to the carrier throughout the next five months, increasing the carrier's capacity and operational flexibility. All eight jets will be delivered this year and enter into service in 2025.
As part of the airline's network expansion, Air Canada has already announced that it will be adding over 50 services to popular sunny destinations across the US and the Caribbean region for its winter schedule..
