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In a bold endorsement of President Donald Trump's tariff strategy, United Airlines CEO Scott Kirby expressed his belief that the measures are a necessary step despite the prevailing uncertainty they are inciting within the travel sector. Speaking at the Semafor World Economy Summit held on Thursday, Kirby suggested that the focus should remain on the long game. We should all take a breath, he stated, comparing the current economic situation to a chess game, where numerous moves still lie ahead.

Kirby highlighted that while the nuances of these tactics may be up for debate, he believes the president has a sincere intention to improve the economic circumstances for middle-class Americans. He asserted that Trump's tariffs could lead to job creation similar to those at United Airlines, where employees can enjoy the stability of long-term employment, potentially spending 40 years with the company and earning six-figure salaries as they advance in their careers.

Adding another layer to the conversation, Treasury Secretary Scott Bessent explained that the tariffs are part of a broader trade strategy aimed at increasing the number of manufacturing jobs in the United States. However, concerns loom large as economists predict these tariffs may inadvertently lead to increased inflation rates and reduce the purchasing power of the dollar, ultimately leaving consumers with diminished disposable income.

As the airline industry grapples with unpredictable travel demand, the effects of tariffs are already being felt. United Airlines communicated to Business Insider that they reached out to a frustrated passenger to offer an apology for any inconvenience she might have experienced. Airline stocks have exhibited heightened volatility in response to tariff-related news, as discretionary travel often becomes the first expense consumers cut during economic downturns.

Weve encountered periods of customer dissatisfaction before, Kirby remarked, offering a perspective shaped by experience. Although he noted that there has not yet been a mass abandonment of summer travel plans, he acknowledged that some individuals may be exercising caution by scaling back their travel intentions.

In a worrisome trend, airlines have begun to forecast diminished travel demand and have announced flight reductions following disappointing earnings reports for the first quarter. In its Q1 earnings call, United Airlines characterized the economic landscape as impossible to predict, taking the uncommon step of providing two profit forecasts for the year. They maintained their original projection of adjusted earnings per share ranging from $11.50 to $13.50, but tempered expectations by indicating that earnings could drop to as low as $7 per share if a recession occurs.

Similarly, American Airlines withdrew its full-year guidance, citing economic uncertainty as a significant concern. CEO Robert Isom informed CNBC, We came off a strong fourth quarter and saw decent business in January; however, domestic leisure travel fell off considerably as February approached.

Delta Air Lines also altered its course, abandoning plans to expand capacity by 4%, with CEO Ed Bastian cautioning that growth has largely stalled in the current economic climate. Kirbys optimistic outlook may serve to bolster investor confidence, suggesting that the situation for airlines may not be as dire as it appears, particularly since United Airlines stands as the worlds largest airline by fleet size.

Moreover, United Airlines is also the largest customer of Boeing, which has found itself in a precarious position as a result of the tariffs. The aircraft manufacturer was initially set to deliver 50 jets to Chinese airlines this year, but now faces the daunting task of remarketing these planes to other countries.