Your weekly travel and aviation Quote-a

10 March, 2023

CTC - Corporate Travel Community each week brings you a roundup of the most thought-provoking and interesting comments from those industry leaders in the know.

AAPA director general: Airfares to normalise as airlines increase capacity to meet pent up demand

Association of Asia Pacific Airlines (AAPA) director general Subhas Menon stated he expects high airfares to normalise as airlines increase capacity to match the level of pent up demand. Mr Menon said: "There's a lot of room to grow" and predicted airlines will reach "an equilibrium between demand and supply" towards the end of 2023.

ACI Europe DG: '2023 is off to a pretty good start'

ACI Europe DG Olivier Jankovec stated "2023 is off to a pretty good start thanks to the continued resilience of passenger demand in the face of higher air fares and wider inflationary pressures across the economy". Mr Jankovec said 42% of European airports have recovered to pre pandemic traffic levels, noting "while there are significant performance variations across markets, we expect more to hit the same milestone in the coming month". Mr Jankovec added: "Continued capacity expansion by ultra-low cost carriers and the recent lifting of pre-departure testing requirements for travellers from China should keep driving the recovery forward for airports", with the immediate focus being the preparation for the peak summer season

Lufthansa Cargo CEO not expecting extra capacity on Asia-Europe routes

Lufthansa Cargo CEO Dorothea von Boxberg stated she does "see a huge amount of extra capacity coming in" to the Asia-Europe market from the European side, due to the impact of Russian airspace closures. Ms von Boxberg underlined this is "because the additional aircraft will mostly fly more to Asia where they will have the detours and that means there will not be as much belly capacity available". The detours are accounting for between 10% to 12% of Lufthansa's capacity, according to Ms von Boxberg. Ms von Boxberg added that "on the freighter side there is not a huge amount of new freighters coming into the market".

Kenya Airways CEO: African airlines 'need to consolidate' to 'create bigger entities'

Kenya Airways Group MD and CEO Allan Kilavuka stated: "The African aviation market is very fragmented" and added that most African airlines "are not viable". Mr Kilavuka said: "The solution to that is to consolidate... We need to consolidate so that you create bigger entities that are more economical from a scale perspective and can respond to high costs". He said larger consolidated carriers "can together talk to suppliers and get more bargains when it comes to purchases, so bring down the unit cost of operation".

ALTA CEO: Region showed 'enormous resilience' in 2022

Latin American and Caribbean Air Transport Association (ALTA) executive director and CEO José Ricardo Botelho stated the region's aviation industry has shown "enormous resilience" in 2022, adding traffic data from Jan-2023 shows "a slight slowdown in the path and the challenging prospects we will face in 2023". Mr Botelho said: "Our task is focused on promoting State agendas that consider aviation as an essential economic sector". He added ALTA will also focus on agendas that "provide the technical information that results in actions that improve regulations, tax burdens and contribute to governments and industry developing the great potential economic and social well-being that derive from air connectivity".

Lufthansa Group CEO: EUR1.5bn operating profit a 'much better result than expected'

Lufthansa Group CEO Carsten Spohr stated the group "achieved a much better result than expected" with an operating profit of EUR1.5 billion for 2022. The group returned to a "clearly positive result" despite high cost inflation, especially regarding fuel costs. Although earnings for the passenger airlines segment were still heavily impacted by the Omicron variant and related restrictions at the beginning of 2022, they "benefitted from a significant increase in demand for airline tickets over the course of the year".

JetBlue/Spirit merger is 'best antidote' to dominant 'Big Four' carriers: JetBlue CEO

JetBlue Airways CEO Robin Hayes stated the carrier is "obviously disappointed" in the US Department of Justice (DoJ) filing an antitrust lawsuit against the carrier's planned merger with Spirit Airlines, maintaining the transaction is "the best antidote" to the dominant 'Big Four' legacy carriers in the US aviation market. Mr Hayes reported JetBlue strongly believes the transaction would provide "a massive net consumer benefit", adding DoJ's lawsuit would prevent JetBlue from making a "profound difference" if successful. He noted the 'Big Four' - American Airlines, Delta Air Lines, Southwest Airlines and United Airlines - account for approximately 80% of US air traffic.

SAS CEO: Passenger demand continues positive trend in Feb-2023

SAS CEO Anko van der Werff stated "passenger demand continued its positive trend" for the group with 1.6 passengers handled in Feb-2023, increased 64% year-on-year. Load factor improved 13pp year-on-year to 71%. Mr van der Werff added the group is continuing "to prepare for a busy summer season and the launch of our 20 new summer season routes".

Volaris seeing 'healthy' traffic growth: CEO

Volaris president and CEO Enrique Beltranena stated (07-Mar-2023) the carrier is seeing "healthy traffic growth and solid booking curves" for the upcoming spring season. Mr Beltranena added: "Consumer demand remained robust across all of our markets, with particular strength observed in international regions". He noted jet fuel prices were slightly more favourable than the prior guidance provided to the market.

Copenhagen Kastrup Airport 'got back on track in 2022': CEO

Copenhagen Kastrup Airport CEO Thomas Woldbye, in the company's 2022 financial statements, stated "The airport got back on track in 2022 but we still face challenges from global uncertainty and an additional debt of over DKK2 billion (EUR268.8 million) accumulated as a result of the pandemic", adding "This is why it's crucial that the airport's framework conditions fall into place in 2023".