The summer of 2020 was unlike any other for Europe’s air transport system. Normally, a period of peak demand, ongoing international travel restrictions coupled with low traveller sentiment meant that while traffic levels were up considerably on previous months, they remained significantly down on previous years.
This was a clear and obvious sign for the future. The summer is when most airlines flourish and build a nest egg for the tougher winter months. Last year’s unprecedented performance meant that was not possible and now as a second wave of COVID-19 infections spreads around the continent forcing governments to introduce stricter mobility restrictions, means conditions have got even tougher.
International Air Transport Association (IATA) regional vice president Europe, Rafael Schvartzman, has said projections for 2021 and 2022 are “a little short of a disaster for European air transport”, with border restrictions and quarantines bringing “demand to a halt”. He said that while there is optimism over a vaccine, this is “unlikely to come in time” to prevent hundreds of thousands more job losses in an industry that already entered the year much reduced in scale.
IATA reported the impact of travel restrictions and quarantine on travel demand in Europe is “clear”, with more than seven million jobs lost or at imminent risk due to the COVID-19 shutdown. Its analysis shows that intra-EU bookings are down -81% year-on-year up to 10-Jan-2021 compared with the usual booking curve.
The economic recovery will be hampered by the loss of connectivity that is being felt by European cities, it said, noting that since 2019, total connectivity has declined by around two-thirds in most of the major city markets – -68% in Frankfurt; -67% in London and Paris; -66% in Istanbul; -64% in Moscow; and -53% in Amsterdam.
ACI Europe, the region’s airport body, reported the tightening of travel restrictions by European states is preventing any recovery in passenger traffic and steeper falls in air connectivity across Europe. The organisation noted that another 700 air routes have disappeared from European airports between Nov-2020 and Jan-2021, bringing the total figure of lost air routes to 6722, a decrease of 55% year-on-year.
This quarter – 1Q2021 – was always going to be difficult. The quarter is the toughest trading period even in a normal world. The International Civil Aviation Authority (ICAO) expects Europe’s airline seat capacity to fall more heavily in 1Q2021 than it did in 4Q2020. Moreover, it forecasts capacity declines in Europe by more than world averages in both 1Q2021 and 2Q2021.
This outlook is supported by schedules data from OAG combined with CAPA – Centre for Aviation Fleet Database seat configurations. In a report this week – European aviation: winter capacity slide to get worse – CAPA says Europe’s capacity in the week commencing 18-Jan-2021 is down by -73.5% from 2019 levels, a much bigger fall than other world regions.
Europe’s capacity decline has widened from -70.9% last week and for Jan-2021 as a whole, current schedules indicate a slide to -70%, from -68% in Dec-2020. European airlines continue to face a very difficult outlook and all this suggests that “traffic trends have not yet bottomed out,” says CAPA.
“European capacity and traffic data have consistently underperformed global data during the pandemic, apart from a short period of summer 2020. This reflects Europe’s struggle to reduce COVID case numbers since around Aug-2020 and the consequent impact on travel restrictions,” it adds.
The International Civil Aviation Organization (ICAO) warns that the near term outlook for global air travel is for “prolonged depressed demand”, with downside risks to global travel recovery and further deterioration likely in 1Q2021. ICAO expects any improvement to only develop by 2Q2021, subject to the effectiveness of pandemic management and vaccination rollouts.
Under the most optimistic scenario, passenger numbers may recover to 71% of 2019 levels (84% for domestic and 53% for international) by Jun-2021, estimates ICAO. Under a more pessimistic scenario, traffic may only recover to 49% of 2019 levels (66% domestic and 26% international).
For Europe, in the short-term the challenges remain high, but vaccination programmes clearly raise hopes for summer 2021. A travel sentiment survey from the European Travel Commission shows that a third (32%) of travellers indicated that they intend to take a trip during Apr-2021 to Jun-2021, an increase of 20% compared to a similar survey in Nov-2020. Additionally, 52% of Europeans plan to travel in the next six months, a 5% increase compared to the previous survey.
The survey also indicates that intra-European travel is now the top choice as 40% of respondents are willing to take a trip to another European country. Leisure is the primary purpose for close to 63% of the surveyed Europeans planning to travel in the short term, while visiting friends and relatives is the main motive for another 21%.
Travel for business accounts for just 9% of expected demand though, according to the survey findings, and the loss of this premium group will remain a challenge through all of 2021 and into subsequent years. ICAO says industry recovery was “vulnerable and volatile” in the last four months of 2020. Nothing suggests anything has yet changed in 2021.
You can keep up to date with the latest air capacity trends in our weekly report: Charting the trends