In its latest report IATA studies and highlights the potential paths for recovery into the medium and long run.
Outline:
- Air traffic has hit a turning point in mid-2020 but remains lower than usual
• Baseline forecasts suggest recovery is not expected until 2023
• There remains uncertainty in the outlook and recovery could be delayed
• Long-run growth potential is evident but with risks more skewed to the downside
Specifically:
- The global number of flights is increasing, but still down 60% vs 1 January
- Regional recovery has been mixed, with a recent surge from European carriers
- Domestic travel has recovered more quickly than international, as expected
- Traffic volumes suggest April is the low point, but with only a modest recovery
- Global macro backdrop has softened as the virus has persisted & evolved
- Three broad areas of uncertainty in the outlook (Enduring travel restrictions, economic uncertainty & loss in GDP, Weakened consumer confidence)
- Travel restrictions will be lifted sequentially
- Economic recovery will begin in H2, but with lingering impacts
- Unemployment impact is seemingly limited for now (14% in Q3 for USA and Canada, 8% for Eurozone)
- But there is significant underemployment, and rises to come in some markets
- Air passenger demand is not expected to regain 2019 levels until 2023
- Domestic passenger demand should recover ahead of international
- Domestic and short-haul passengers will remain important
- Importance of long-haul demand is one key factor for recovery
- Two short-term scenarios, incorporating macroeconomic & consumer drivers
- Passenger numbers will recover their 2019 level by 2023 (baseline scenario) for up to 30%
- Risks and uncertainty remains tilted to the downside
- Consumer confidence remains key, even as business sentiment has lifted
- Potential for long-run growth, but with risks skewed more to the downside
You can read HERE the full presentation of the projected recovery paths
