Air travel could beat pre-pandemic level by 2023, says air transport body

Global air passenger numbers could rebound from the coronavirus pandemic to top 2019 levels by 2023, the International Air Transport Association predicted on Wednesday.

With much of the world still suffering from the spread of the virus and travel restrictions, travelers are expected to number just 52 percent of the pre-crisis level this year, IATA forecast, rising to 88 percent next year.

But after surging past pre-pandemic numbers in 2023, the end of the decade could see annual levels of 5.6 billion air passengers, the industry body said.

At 1.8 billion, the number for 2020 was around the same as in 2003, according to the International Civil Aviation Organization (ICAO).

"We are in the deepest and gravest crisis in our history. But the rapidly growing vaccinated population and advancements in testing will return the freedom to fly in the months ahead," said IATA director general Willie Walsh.

"When that happens, people are going to want to travel."

Walsh pressed governments to move faster on measures to help air travel reopen.

In total the passenger shortfall from the coronavirus crisis will have cost the industry two to three years of growth over the decade, IATA added.

The industry body expects average annual growth in passenger numbers of 3.2 percent between 2019 and 2039.

Agence France-Presse

Airline stocks nosedive as US travel ban hits EU travel sector

PARIS - Europe's travel sector reacted with dismay Thursday to a US-imposed trans-Atlantic travel ban that sent the share price of major airlines into free fall.

The International Air Transport Association (IATA) warned that airlines needed "emergency measures" after President Donald Trump imposed the ban to stem the spread of coronavirus.

Air France stock lost almost 18 percent at the Paris opening bell, before recovering to trade five percent lower in mid-afternoon exchanges.

Lufthansa shares, quoted in Frankfurt, were off by almost nine percent.

The US is not banning passengers from Britain, but shares in British Airways' parent company IAG still slumped more than 10 percent, while EasyJet lost over nine percent.

'KICKNG A MAN'

"Trump is simply kicking a man when he's down," according to an EU diplomat in Brussels who called the ban "erratic."

Trump said the US would not allow travelers from the EU's Schengen border-free zone into the country for 30 days, calling the move an "aggressive" effort to contain the spread of COVID-19, the disease caused by the new coronavirus.

The decision does not affect visitors from Britain and Ireland, or US citizens returning from Europe.

Key US companies were hit even harder than their European counterparts, with the sector suffering its worst downturn since the September 11, 2001 attacks.

Boeing, already reeling from problems with the 737 MAX jet, lost 14 percent by the time trading was suspended Thursday, which added to its 18 percent drop a day earlier.

Shares in United Airlines shed nearly 15 percent on Wall Street before trading was suspended after the S&P 500 index lost seven percent.

Global markets have lost a combined $11.3 trillion in value since a peak on February 19, and $4.5 trillion this week alone.

American Airlines and Delta plunged by double-digit percentages.

'HAMMER BLOW'

"The travel ban is another hammer blow for the airlines" that "were getting crucified by the reduction in tourism and business travel in the last month," said economist Charlie Robertson at Renaissance Capital in London.

Peter Elbers, chief executive of the Dutch carrier KLM, told public television NOS: "It is undeniable that the consequences are extremely heavy."

Fears that other countries might follow the US example "are paralyzing the market," said Timo Emden of Emden Research.

French Finance Minister Bruno Le Maire told a news conference: "Trump's announcement is bad news for all airlines."

Le Maire "regretted" a decision "which will have a very strong impact on tourism and a very strong impact on companies in general."

INEFFECTIVE?

European leaders argue that travel restrictions are ineffective because the virus has now spread almost worldwide, and lament that Trump had not consulted them first.

After speaking with Air France chief executive Benjamin Smith, Le Maire said they would look for ways to "ensure Air France comes through this difficult moment... in the best possible conditions."

Airlines are especially vulnerable to a sharp drop in tourism and business travel.

Italy, the worst hit country in Europe so far, has quarantined its entire population of 60 million, the US has advised citizens against all foreign travel, and tourist magnets like Paris are bracing for hard times.

Service sector businesses have been pummelled and industrial supply lines are also under pressure, further dampening economic activity.

The ban "will create enormous cash-flow pressures for airlines," IATA head Alexandre de Juniac said. "Airlines will need emergency measures to get through this crisis."

On March 5, IATA estimated that the crisis could wipe out some $113 billion in airline industry, but the organization stressed that that estimate did not include the severe measures the US and other governments, including Israel, Kuwait and Spain, have since put in place.

Amsterdam-Schiphol Airport, one of Europe's biggest hubs, reported Thursday a 20-percent drop in passengers in the first week in March and prepared to work at reduced capacity.

"If all flights to and from the United States were canceled, this percentage would rise to 30 percent," the airport statement said.

Agence France-Presse

Etihad Airways enters expanded codeshare deal with Air France-KLM

MIAMI - Etihad Airways has reached a deal to deepen its relationship with Air France-KLM and separately has agreed to sell its stake in Aer Lingus Group Plc, Etihad's Chief Executive Officer James Hogan said in an interview Sunday.

Etihad and Air France-KLM will share codes on more flights starting this year, opening more European cities to the Abu Dhabi-based airline's customers, Hogan said on the sidelines of the International Air Transport Association's (IATA) annual meeting. The airlines have yet to finalize terms of the deal.

Hogan added that Etihad will sell its 4.99-percent stake in Aer Lingus, the Irish flag carrier, in a potential takeover bid by British Airways-parent International Airlines Group.

The moves reflect Etihad's strategy to grow its route map through airline partnerships. With codeshares on French domestic flights imminent, Etihad also is looking to add destinations via codeshares with Philippine Airlines, Garuda Indonesia and Malaysia Airlines, Hogan said.

"We're keen to maintain a relationship with (IAG). Indications are that they're interested in doing so too," Hogan said.

Kevin Knight, Etihad's chief strategy and planning officer, said in the same interview that Etihad hopes to expand its codeshare with Air France-KLM "as broadly as possible."

Etihad currently lists its flight code on nine Air France cities and 21 KLM destinations.

Hogan said sharing frequent-flier rewards would be the next step in the airline's partnership with Air France-KLM. It has not discussed or considered taking an equity stake in the European carrier, although saying this would never happen is "not possible," Hogan said.

Across the Atlantic, Knight said Etihad does not have plans to introduce new service to the United States for 24 months. The decision to focus on existing U.S. routes contrasts with competitors Emirates and Qatar Airways, which have announced new flights to seven U.S. cities this spring.

Recent expansion of Gulf-carrier service to the United States has caused tensions with U.S. airlines to boil.

U.S. airlines say their Gulf competitors have received more than $40 billion in subsidies from the United Arab Emirates and Qatar, which has allowed them to add excess capacity on key routes, drive down ticket prices and steal market share.

The Gulf airlines deny the claims. Etihad said it is required to repay loans - not subsidies - to its sole shareholder, the government of Abu Dhabi.

source: www.abs-cbnnews.com