The apparent uptick in air traffic accidents and incidents in 2024, spearheaded by aeroplanes made by Boeing (NYSE: BA), has done much to reduce the industry’s reputation.
In 2025, the number of reasons not to bet on the sector has increased due to a new series of dramatic events and wider macroeconomic and geopolitical factors.
Delta Airlines (NYSE: DAL), one of the biggest such companies in the world, saw its stock price suffer a dramatic drop as it cautioned that demand for air travel is likely to be impacted by broader economic concerns.
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Specifically, DAL shares are 21.89% down in 2025 and are changing hands at $47.26 at press time on March 12.
How a political transition is likely to depress airline stocks in 2025
Despite running on a platform of peace, prosperity, and economic healing, the first two months of the second Donald Trump presidency have been disastrous for the stock and cryptocurrency markets.
For example, the benchmark S&P 500 index fell 7.89% since January 20 – the inauguration day – and Bitcoin (BTC) is down 17.68% within the same timeframe.
So far, President Trump’s aggressive tariff program has served as a trigger for the series of bloodbaths affecting the market in recent weeks. Investors remain concerned about the potential effects on businesses they own stocks of, and consumers are fearful about the probable spillover effects on prices.
There has also been a geopolitical dimension to the concerns. The U.S. has, via the tariffs and unfriendly rhetoric, begun alienating its traditional allies and even compelled the EU into unveiling several ambitious investment programs.
There has also been a diplomatic fallout as Trump has sided with Israel and its agenda of forcefully depopulating Gaza at the very least. At the same time, the EU appears to have sided with the Arab countries’ rebuilding plan.
No end to global conflicts increase danger of air travel
Along with opening the gates for massive economic damage and supply issues later down the line – though some impact might become obvious sooner as Yemen has reactivated its blockade of the Red Sea as Israel cut water and electricity supply for Gaza – there may be more than a vicarious impact on air travel.
Recent years have, unfortunately, seen multiple fatal crashes near and above war zones, with missile or electronic attacks frequently identified as culprits.
Though the diplomatic and political situation is likely to affect air travel – and airliners – the economic pressure may prove more severe and multi-faceted.
Will more people lack reason and means to travel in 2025
Along with Delta unveiling that it expects people to book fewer flights due to, in essence, a lack of money, the program initiated by Elon Musk and his Department of Government Efficiency (D.O.G.E.) is also already having an impact.
United Airlines (NYSE: UAL) recently revealed that one of its traditionally most profitable hotspots – Washington D.C. – has become decidedly less profitable. Specifically, the airline stated that it is witnessing a 50% drop in government-related travel.
The company’s situation is likely to get worse in the coming months, judging by the deluge of announcements from various government agencies about mass layoffs.
It is noteworthy that, beyond the more common discussions between a leaner and a functional government or about whether Elon Musk is too reckless in the way he is purging the administration, the program will leave thousands, possibly tens of thousands, jobless.
Such a setup will create legions of people who not only lack a reason for air travel but also the means. Though the greater U.S. economy will likely eventually absorb the majority of these workers, the headwinds should be expected to persist for at least some time.
People may be more fearful of air travel in 2025
Lastly, the psychological impact should not be underestimated, along with the economic uncertainty, an upsurge in joblessness, and diplomatic and political circumstances.
While data shows that 2024 had fewer accidents than 2023 – though, admittedly, it was worse regarding fatalities – 2025 had a particularly bad start. By February 20, the year featured 89 incidents that left 80 dead.
Simultaneously, despite being widely perceived as especially bad, the entire last year witnessed 30 accidents with 416 fatalities.
Featured image via Shutterstock
