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Interview Synopsis

European airlines – post-coronavirus travel recovery & market outlook

  • Credit
  • Industrials
  • Europe

Airlines are still experiencing turbulence as the industry charts a course to recovery. And “Europe is still a bit lagging behind other domestic markets”, a former director from the International Air Transport Association told Third Bridge Forum in an Interview that also covered airlines’ strategies and potential bottlenecks.

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Usually summer is the best-performing season for airlines, but this year has been underwhelming. “It’s not going to be as good as expected, and even for the fall [airlines] are struggling to make their plans in terms of capacity.” Although leisure has bounced back with “strong demand”, business travel is struggling and “will resume maybe sometime next year”.

Looking ahead to a full recovery, 2023 is touted as the year that the industry will reach 2019 levels again. However, “it simply means that we’ve lost four years of growth. Traffic growth used to be 5% per year and now we just lost four years.” In addition, some aspects of consumer behaviour may change permanently. “When I speak to other corporates, in terms of meetings, they won’t come back even in 2023, so that part of the demand will disappear.”

We also heard about which airlines are acting aggressively, taking advantage of companies that are in a bind, with the specialist highlighting Wizz Air and Ryanair in particular. “If you are more aggressive, you have the agility to create new bases and create new routes, some players like Ryanair take advantage to steal that demand.”

In terms of future challenges, the “number one priority” is safety. “You have new aircraft coming, so you make sure they are safe. Now, also there’s the health of your passengers and of your staff.” Another concern is what will happen during the winter to companies that received financial assistance, especially as this summer was not as strong as expected. “I don’t see governments [doing] another round of financing.”

To access all the human insights from Third Bridge Forum’s European airlines – post-coronavirus travel recovery & market outlook Interview, click here to view the full transcript.

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