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AIRLINE PROFITABILITY IN Q4

Air travel to surpass pre-Covid level demand this year: ICAO

MONTREAL, Canada, February 9, 2023

Air passenger demand in 2023 will rapidly recover to pre-pandemic levels on most routes by the first quarter and growth of around 3% on 2019 figures will be achieved by year end, according to the International Civil Aviation Organization (ICAO).

“Assuring the safe, secure, and sustainable recovery of air services will be key to restoring aviation’s ability to act as a catalyst for sustainable development at the local, national and global levels, and will consequently be vital to countries’ recovery from the broader impacts of the Covid-19 pandemic,” said ICAO Council President Salvatore Sciacchitano.

“The air passenger forecasts ICAO is announcing today build on the strong momentum toward recovery in 2022, as previously assessed by ICAO statistical analysis,” remarked ICAO Secretary General Juan Carlos Salazar.

“Through ICAO, governments have reached agreements on goals toward zero accident fatalities by 2030 and zero carbon emissions by 2050 goals, and these will continue to play key roles in both guiding continued progress and in prioritizing ICAO’s implementation support initiatives.”
 
The number of air passengers carried in 2022 increased by an estimated 47% compared to 2021, while revenue passenger kilometres (RPK’s) increased by around 70% over the same period, due mainly to the rapid recovery of most international routes. In terms of airlines’ annual passenger revenues, keeping yield and exchange rates at 2019 levels, ICAO observed growth of an estimated 50% from 2021 to 2022.

In line with earlier ICAO predictions, the strong recovery in air passenger demand has resulted in 2022 passenger numbers reaching an estimated 74% of pre-pandemic levels, while passenger revenues are estimated to have reached around 68% of 2019 levels. The number of passenger aircraft in service in 2022 mirrors the overall traffic recovery, with current estimates suggesting 75% of pre-pandemic levels.

In 2022, aircraft orders and deliveries by major manufacturers Airbus and Boeing grew by 53% for orders and 20% for deliveries, compared to the previous year. The number of orders in 2022 exceeded that seen since 2019, indicating the recovery of aircraft demand.

Current estimates for air cargo in 2022 reflect 2021 levels, while still showing marginal growth compared to the pre-pandemic level. The pace of growth for air cargo is however expected to be lower in 2023, given the slowing global economic growth, although long-term air cargo growth remains in line with previously estimated trend indicating strong long term growth.

Looking further ahead, airlines are expected to return to operating profitability in the last quarter of 2023, after three consecutive years of losses. Air passenger demand in 2024 is expected to be stronger, at around 4% higher than 2019. In terms of Compound Annual Growth Rate (CAGR), this translates to a growth of 0.7% over the 2019-2024 period. – TradeArabia News Service




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