COVID-19 Pandemic Could Have Long Lasting Effects on European Airlines
Joe Cortez April 29, 2021
As airlines look towards recovery, not all carriers could have a tailwind with an upward trajectory. According to new analysis, European airlines could face another year of devastating losses, creating an even more uncertain future.
While U.S.-based carriers express their optimism towards recovery in the summer travel season, the runway towards profitability could be even longer for European carriers. New analysis from CAPA Centre for Aviation is projecting Europe will have the worst loss margin compared to all regions around the world.
European Carriers Reporting the Weakest Passenger Numbers Internationally
It’s no secret that European carriers were disproportionally hurt by the COVID-19 pandemic. When former president Donald Trump closed borders to Europe at the start of the novel Coronavirus outbreak, the airline industry experienced significant losses. The conditions were so severe that aviation conglomerate Lufthansa was forced to take a bailout from the German government.
Over one year later, the aviation industry is still hurting. During the week of April 26, 2021, seat capacity across Europe was down over 72 percent compared to the same time in 2019. In addition, passenger numbers are also down, meaning airlines are still losing money.
In comparison, capacity during that week in North America was down by 38.3 percent, due to increased domestic flying by U.S.-based airlines. Other parts of the world also showed increases: the Asia Pacific region was down 30.6 percent compared to 2019, while Latin America was off by only 45 percent.
For 2021, the International Air Transport Association projects that revenue passenger-kilometers will by down by two-thirds compared to 2019, with profits down by nearly 20 percent. Unless things turn around soon, European carriers could be looking at a cruel summer.
Recovery Hinges on Europe Opening Borders to Trans-Atlantic Travel
Even though the situation is dire for European travel, hope for a recovery hinges on travel opening. The New York Times reports in comments to local media, European Commission president Ursula von der Leyen said she foresaw a situation where vaccinated Americans would be allowed “free movement and travel to the European Union” as soon as this year. The comments were immediately praised by the IATA, with organization director general Willie Walsh calling it “a step in the right direction.”
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Walked around in a huge Asian city this week. It has a mask-everywhere mandate. Don't want to do that again. If masks are forever, I'll travel in my next life and consider travel in this one to be in the bag.
I was just in that 'award-winning' major Asian airport, regularly ranked best airport or near the top: This huge Asian airport was deserted. There is no way this can continue. Had lounge access (only one open in T2): the lounge now functions as an airport employee break room. What a benefit for them! Flight to Seattle was at around 35%. Again, no way this can continue. Seattle was busy and my onward 2.5hr flight into this large desert city where I live (sometimes) was packed. I think some places got the Plan A right in some sense, but the medicine is killing the patient at this point.
Perhaps rephrase the headline as "Outrageously ignorant government interventions Could Have Long Lasting Effects on European Airlines." There is no empirical evidence government mandated restriction of movement has made a difference. You can not hide from the virus. It will stay dormant over the summer in Northern Europe, so might as well get out and fly, vacation etc.
Well not only that, Europe tends to have far more extensive rail network than other continents, as well as folks' mentality of "if it's within 3 hours train ride, take the train and skip the plane!" - all these contribute to drops in (air) traffic. Exception would be those who are island nations (like Ireland, Iceland, etc) - they have no good choice but to fly. Border-closure aside, Europeans are still traveling, or dying to travel again.