U.S. laptop ban could hit profitable international flights into the US 

Internatinal travel is lucrative for airlines, but a potential expansion of the Trump Administration’s electronics ban could put a big monkey wrench in demand for international and luxury travel markets, which fall into our Affordable Luxury and Rise & Fall of the Middle Class investment themes. If the Trump ban is extended, it would mean Delta Air Lines (DAL), United Airlines (UAL), American Airlines (AAL), and  British Airways (BAIRY) – combined, those four airlines account for nearly 60 percent of all nonstop flights from Europe to the U.S.

The U.S. introduced rules in March that require any electronic device larger than a smartphone to be carried in checked baggage on flights from 10 airports in the Middle East and Africa. (It cited intelligence suggesting terrorists could hide explosives in bigger devices.)

The details of a potential expansion of the Trump administration’s electronics ban are not yet clear. But the aviation and tourism industries are preparing for the worst.

James Stamp, global head of aviation at KPMG, said that business and luxury travel is likely to take a significant hit from a laptop ban, unless airlines can figure out a workaround. “The North Atlantic market is highly competitive, but also highly profitable because of the links between the key financial centers of Europe and New York,” he said.

That means no laptops in the cabin — a major sticking point for business travelers. Stamp noted that many businesses won’t even allow employees to check a laptop.

The worry for airlines is that bookings could slump.

Source: U.S. laptop ban could hit 350 flights a day from Europe – May. 11, 2017

About the Author

Chris Versace, Chief Investment Officer
I'm the Chief Investment Officer of Tematica Research and editor of Tematica Investing newsletter. All of that capitalizes on my near 20 years in the investment industry, nearly all of it breaking down industries and recommending stocks. In that time, I've been ranked an All Star Analyst by Zacks Investment Research and my efforts in analyzing industries, companies and equities have been recognized by both Institutional Investor and Thomson Reuters’ StarMine Monitor. In my travels, I've covered cyclicals, tech and more, which gives me a different vantage point, one that uses not only an ecosystem or food chain perspective, but one that also examines demographics, economics, psychographics and more when formulating my investment views. The question I most often get is "Are you related to…."

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