Delta Air Lines CEO Ed Bastian spoke to an audience of Detroit business leaders on Friday. He said that Delta’s $200 surcharge per month for unvaccinated workers puts pressure on more workers to get the vaccine. He also justified the $200 surcharge and also compared Delta’s vaccine mandate to other airlines.
Bastian met with the Detroit Economic Club on Friday. He spoke on stage for more than 30 minutes discussing the future of airline travel in a question-and-answer session.
$200 Surcharge Per Month
In late August, Delta announced that unvaccinated employees will have to pay a $200 surcharge per month for their health insurance. For Bastian, this setup is only fair. He said that the average cost of hospitalization for COVID is $50,000.
The $200 surcharge takes effect on November 1. However, Delta’s vaccination rate shows the effectiveness of the policy. When the policy was announced, Delta’s vaccination rate was just at 75%. Now, it’s over 90%. Bastian said that “and as it starts kicking in the next few weeks, that number could easily go north of 95%”.
A Different Approach to Mandates?
The Biden administration’s executive order compels federal contractors and large businesses to require COVID19 vaccination among their employees. United, American, JetBlue, and Southwest announced vaccine mandates that will terminate unvaccinated employees.
For Bastian, “These mandates, unfortunately, are really blunt instruments”. However, he differentiated Delta’s vaccine mandate saying: “You can either get vaccinated or you’re going to pay an insurance charge”. Bastian also said that the company will grant medical or religious exemptions to Delta’s $200 surcharge per month.
Aside from the vaccine mandate, he discussed the current status of the airline industry. According to Bastian, he said that the airline saw “enormous pent-up demand” during summer. Delta went from 40% to 50% full in May to 90% capacity by July. Right now, Delta is back at approximately 80% of its pre-pandemic level for domestic flights. But Bastian is hopeful that the airline will get to 90% to 95% of its pre-pandemic level by next summer.
