A survey commissioned by the International Air Transport Association (IATA) of recent travellers found that 60% anticipate a return to travel within one to two months of containment of the coronavirus pandemic, but 40% indicate that they could wait six months or more. However, 69% indicated that they could delay a return to travel until their personal financial situation stabilises
These early signs of a cautious return to travel can be seen in the domestic markets of China and Australia where new coronavirus infection rates have fallen to very low levels, and some aspects of normal life is returning in these two countries.
In China, domestic demand started recovering when the infections fell into single digits and rapidly headed towards zero. IATA stated that while there was an early upswing from mid-February into the first week of March, the number of domestic flights plateaued at just over 40% of pre-Covid-19 levels.
“Actual demand is expected to be significantly weaker as load factors on these flights are reported to be low. China accounts for some 24% of all domestic passengers,” it added.
Data and analytics company Cirium has seen a limited recovery of flights within China in recent weeks, but the indications are that passenger load factors are poor.
“Cancellations are still high, but since the beginning of March the actual number of flights on China’s domestic routes have recovered slightly,” revealed Ascend by Cirium’s chief economist Peter Morris at a recent airline economics webinar.
Cirium data from flight monitoring databases show that global flights, which were up 4% year-on-year in January, first declined, and since then have collapsed. This affected China and Asia flights in February, and has since followed the impact of the virus around the world. In the uncertain business environment, the level of recorded ‘on the day’ cancellations have also risen as airlines try to adjust to dramatically reduced traffic demand. In the United States, the impact occurred later, with the steep fall beginning in mid-March. In China, which experienced the outbreak sooner, flights were cut drastically from early February.
Within the Asean region domestic travel is given a kickstart with the announcement by Asia’s largest low cost carrier AirAsia it would resume domestic flights in Malaysia on April 29, followed by Thailand (1 May), the Philippines (1 May), India (4 May ) and Indonesia (7 May), subject to approval from authorities.
The resumption of services will initially be for key selected domestic routes, which will increase gradually to include international destinations around the network, once the situation improves and governments lift borders and travel restrictions, said the carrier.
The flights are already open for booking via AirAsia website and mobile app.
“We have been working closely with the airport authorities to ensure that all the relevant precautionary measures are in place to ensure a safe, pleasant and comfortable journey for everyone,” said AirAsia Group president Bo Lingam.
IATA noted domestic travel is expected to lead the post-pandemic recovery, followed by regional and then intercontinental as governments progressively remove restrictions.
With this anticipated slow recovery in demand for air travel, IATA’s director general and CEO Alexandre de Juniac called for governments to work with the industry on confidence-boosting measures in the face of an anticipated slow recovery in demand for air travel.
“Passenger confidence will suffer a double whammy even after the pandemic is contained – hit by personal economic concerns in the face of a looming recession on top of lingering concerns about the safety of travel. Governments and industry must be quick and coordinated with confidence-boosting measures.”
He added that people still want to travel. “But they are telling us that they want clarity on the economic situation and will likely wait for at least a few months after any ‘all clear’ before returning to the skies. As countries lift restrictions, confidence boosting measures will be critical to re-start travel and stimulate economies.”
This week IATA is conducting regional summits with governments and industry partners to begin planning for an eventual re-start of the air transport industry.
de Juniac said the passenger business came to a halt with unilateral government actions to stop the spread of the virus. For the industry to re-start, it must be built with trust and collaboration.
“Time is of the essence. We must start building a framework for a global approach that will give people the confidence that they need to travel once again. And, of course, this will need to be shored-up by economic stimulus measures to combat the impact of a recession,” he added.
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