Pandemic is over, Asian airlines still can't escape the slump

Asian airlines are hoping that travelers will choose to travel domestically and internationally by air this summer. But the reality is that travelers are not interested in flying.

Asia's aviation industry is gradually emerging from the effects of the Covid-19 pandemic, but there is no sustainable recovery in air travel demand. (Source: Air Asia)

Figures from airlines and industry sources show strong growth and low vacancy rates. However, these numbers can be misleading.

In fact, the aviation industry is gradually recovering from the effects of the Covid-19 pandemic, but there has not been a sustainable recovery in demand for air travel.

According to data from the Association of Asia Pacific Airlines (AAPA), which includes Singapore Airlines, Cathay Pacific Airways, Japan Airlines and Taiwan’s China Airlines, the number of air passengers has increased by 45% year-on-year so far this year, and seat occupancy has increased to 80.9%. Any manager or economist would be pleased with such an increase.

Compared to the industry’s trickle of activity in the period 2020 to 2022, the 28 million passengers flying 160 billion kilometers in May 2024 is probably a good number. But compared to the level of 2019, the time before the pandemic, the above figure is 13% lower.

The tense relationship between China and the US is one of the reasons for the decrease in demand for tourism/business travel between the two sides.

In addition, China's slowing economy has caused consumers to tighten their spending. China's expanding and improving rail network is also a more economical option for long-distance travel.

In a report on Southeast Asia's aviation industry, the Asian Development Bank (ADB) said that due to increasing workplace flexibility and changes in corporate travel policies, including commitments to reduce carbon emissions, there is expected to be a slowdown in business travel growth.

According to ADB, this new trend will be fewer business trips, but longer durations. As such, hotels and restaurants may outperform airlines.

While popular tourist destinations from Japan to Indonesia are showing signs of a comeback, and the Paris Olympics will attract more trips from Asia to Europe, the data still shows significantly lower than previous levels.

Therefore, the most feasible way for airlines to achieve growth is for them to attract new or less frequent flyers. Low airfares are also a solution.

Source: https://baoquocte.vn/qua-roi-thoi-dai-dich-cac-hang-hang-khong-chau-a-van-chua-thoat-canh-e-am-277740.html