• Wed. Oct 5th, 2022

Turbulent weather leads to clearer skies for the airline industry

ByKimberly A. Brochu

May 6, 2022

IAG – the company that owns British Airways, Iberia and Aer Lingus, among other airlines – released its first-quarter results and the loss was worse than analysts had expected, but a recovery appears to be on the horizon.

Earlier this year, the Omicron variant shook up airline workforces and consumer confidence. Combined with the lull in the low season, this meant the group’s operating revenue was 65% of pre-pandemic levels.

On the positive side, this is an increase from the previous quarter, with analysts now believing that there will be a return to profits by the second quarter.

Chris Pomeroy is one of Europe’s leading tourism experts; as CEO of Interface Tourism Group, his company regularly surveys more than 23,000 travellers. He told CGTN Europe their research suggested the signs were good.

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“In the UK, as soon as it was announced that travel restrictions had been removed, bookings immediately exploded, returning to 82% of pre-pandemic levels,” Pomeroy said.

“Overall, both inbound and outbound – indeed for outbound it was 106% of 2019. That pent up demand, as soon as the barriers were removed people wanted to travel.”

IAG hopes to see its passenger capacity reach 85% of pre-pandemic levels during the summer months. /Reuters

IAG hopes to see its passenger capacity reach 85% of pre-pandemic levels during the summer months. /Reuters

Consumer confidence is crucial for the airline industry. IAG hopes to see its passenger capacity reach 85% of pre-pandemic levels during the summer months, as holidaymakers finally look to start making trips abroad again after two years of uncertainty.

Countries like Spain desperately need a strong summer. Tourism – the country’s top industry – has benefited hugely from an easing of COVID-19 restrictions as it finally appears to be getting back to normal.

The Hotel and Tourism Confederation has already crunched the numbers and its members are very confident of extending their high season from May to October.

Ramon Estalella, who leads the organization, believes his country is the country of his choice.

“People now choose Spain for various reasons – it’s considered a very safe country, not close to any conflict, others just because they like Spain,” he told CGTN. Europe.

“Some have not been able to travel for the past couple of years due to the travel restrictions imposed. So for overseas and domestic tourism on both sides, we are very positive on both.”

New headwinds, such as global inflationary pressures and reduced purchasing power, are weighing heavily and could still play a major role in consumer confidence. But for now, despite a rocky start, the outlook for this year is up.