Airlines Are Cutting $300 Million in Sports Sponsorship

GlobalData estimates airlines cutting more than $300 million in their sports sponsorship deals. In a story by CNBC, American Airlines, United, and Delta are looking to downsize their sports sponsorships on football, basketball, and baseball. According to GlobalData, there is a chance of “wide withdrawal of the airline sector from its sponsorship commitments”.

Cutting the Expenses on Sports Sponsorship

Sports analyst for GlobalData Patrick Kinch said that the “airline sector will withdraw from its current sporting commitments”.

For leagues like NBA, NFL, and MLB, Kinch believes that they will need to find an industry that “has been less troubled by the pandemic”. However, airlines are not stopping their advertising efforts completely. Global airlines are spending $737 million on sports sponsorship for 2021. American Airlines, United, and Delta are collectively paying US sports leagues $197 million for 2021.

American Airlines has naming rights to Miami’s American Airlines Arena and the American Airlines Center in Dallas, Texas. On the other hand, you have United having United Center in Chicago.

This year, American Airlines is set to spend $23.3 million on sports sponsorship with $11 million agreements to expire this year. Delta, on the other hand, is set to spend $70 million with $14 million about to expire. The biggest question is if there will be renewals. Conrad Wiacek, head of sports analysis at GlobalData, said that “it depends on many factors”. He said that government support will play a role as well as vaccinations.

Vaccinations are still not available to the majority of Americans as of today. However, the US government is working towards making it available for every American adult by May.

Losses from 2020

US airlines were able to receive $14 billion of the $1.9 trillion relief package. This was an effort by the Biden administration to keep the travel and tourism industry afloat. The relief is for paying employees and to prevent more job cuts. US airlines lost $35 billion collectively last year when the pandemic started.