In May, airlines saw their worldwide activity approach pre-Covid-19 crisis levels. It reached 96.1% of the same month in 2019, according to Iata. The industry's main association expects its members to post a global profit of $9.8 billion this year, but denounces an "aviation value chain" that remains "unbalanced" given the large profits made by European airports.
Big blue skies on the horizon for airlines worldwide. Calculated in terms of revenue passenger-kilometres, one of the sector's benchmarks, their business reached 96.1% of passenger numbers in the same month of 2019, the last normal year before the Covid-19 pandemic, according to figures published on Thursday 6 July by the International Air Transport Association (Iata), which groups 300 airlines.
This recovery was driven by domestic routes. Activity on these routes reached a global average of 105.3% of the level seen four years ago. May was also the second month in a row that traffic on these routes was higher than before the pandemic. International routes, which restarted later, returned in May to 90.8% of their levels of four years ago, according to Iata.
Strong demand for travel
The association also welcomed the fact that the aircraft load factor in May reached 81.8%, back to its pre-Covid level.
"People need to fly, and they like it", said Iata Director General Willie Walsh, quoted in a press release. "The strong demand for travel is one of the elements supporting airlines' return to profitability", he added.
Iata forecasts that its airlines will carry 4.35 billion passengers this year, not far from the record of 4.54 reached in 2019. It also expects this level to be beaten in 2024. As a reminder, in 2020, the first year of the pandemic, passenger numbers plummeted by 60% to 1.8 billion. It rebounded slightly in 2021 to 2.3 billion, and by 2022 had returned to 74% of its pre-crisis level, i.e. some 3.3 billion passengers, according to the International Civil Aviation Organization (ICAO), a UN agency.
An "unbalanced value chain"
Having lost almost two-thirds of its passengers in 2020, the airline industry has since recovered. As a result, Iata has said it expects its members to make a global profit of 9.8 billion dollars this year, after cumulative losses of 183 billion in 2020-2022. However, Willie Walsh pointed out that the 2022 profit represents just 2.25 dollars per passenger, a margin he described as "unsustainable in the long term".
He also took the opportunity to take a swipe at airports. He considers that "the aviation value chain" remains "unbalanced", citing the cumulative profits of 6.4 billion euros (7 billion dollars) made by European airports in 2022, according to their association ACI Europe. At the same time, European airlines generated profits of 4.1 billion dollars, according to Iata estimates.
"Does the economic regulation of airports defend the public interest when the holders of a monopoly (the airports) can apparently obtain much better results than the competitive sector (the airlines)", asked Willie Walsh, inviting governments to "at least take a look at the dossier".
According to ACI Europe, the crisis has resulted in cumulative losses of €20 billion for airports on the Old Continent by 2020-2021, and a loss of revenue of €50 billion. Airport debt has ballooned by €47 billion in two years.
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