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COVID-19: Forward indicators for Australia aviation & travel

In projecting likely outcomes as the COVID-19 coronavirus disrupts all previous predictions, CAPA has turned to our data partners,some of the best forward indicator data sources in aviation:

- OAG, schedules
- 3VIctors, travel searches
- ForwardKeys, forward bookings
- PredictHQ, conferences and events.

At this stage in the rollout of the worst threat to the industry in modern aviation, many of the indicators are predictable, airline seats are being grounded, travel searches are confounded by the absence of real travel options, with a similar impact on forward bookings; conferences and events equally are almost uniformly being cancelled or postponed.

But, as can be seen below there are some very modest indications of hope for the coming months - which we shall track as they mature into a real recovery. When those forward looking results start to offer guidance to future actions, their full value will emerge.

For now, as PredictHQ suggests below, "the good news for airlines is that the vast majority of the events have been postponed", rather than being cancelled, so once the revised dates start to firm up, the outlook brightens considerably. The effects on the airline industry will then be indicated by 3Victors and ForwardKeys as the news translates into buyer activity.

1. The starting point: Airline forward capacity planning (CAPA-OAG)

Australian domestic and international seat capacity falling off a cliff

According to CAPA Membership Schedule Analysis data, domestic airline capacity levels in Australia continue to be in free-fall.

The graphic below is drawn from the latest weekly flight schedules filed with OAG using aircraft configuration data applied from the CAPA Fleet database, to produce the Schedule Analysis tools. The data do not reflect the impact of state border closures this week and will drop further in coming weeks.

Australia weekly total domestic seat capacity w/b 23-Mar-2020

Domestic air travel "shopping" has slowed almost to a halt

Domestic travel search, or ‘shopping’ has collapsed, since reaching a peak of just under 10 million daily searches, according to travel big data company, 3Victors.

Travel shopping interest is expected to decline further, although 3Victors expect online travel shopping activity, or ‘browsing’ could still occur as people have more time on their hands in the coming weeks and months.

Whether they are permitted to fly and/or can find a seat at an attractive price, is another question at this stage.

Australian domestic travel searches via reservation systems: 24-Feb-2020 to 24-Mar-2020

International capacity and search head in the same direction

International seat capacity to and from Australia is also collapsing. The rate of decline paused at around 520,000 seats for the week beginning 23-Mar-2020 and the previous week, reflecting the ‘repatriation effect’ of travellers heading home before the travel bans.

But the rapid removal of seats will continue at pace in the w/b 30-Mar-2020, as airlines refile their schedules, causing the green dotted line to likely collapse in the coming days as the numbers update.

Australia weekly total international seat capacity

International search for travel also peaked in late Feb-2020, before surging again on 9-11-Mar-2020 as more stringent travel restrictions were announced and Australian residents clamoured for flights home.

Travel search to Australia has since stepped down sharply to be a quarter of former levels – with further drops expected.

Inbound travel searches to Australia via reservation systems – all countries: 24-Feb-2020 to 24-Mar-2020

2. Forward bookings: Australian outbound forward bookings have tumbled (ForwardKeys)

The Outlook for Australian forward travel looks extremely negative, according to the big data and business intelligence company, ForwardKeys. Forward bookings as of 18 March 2020, just prior to the Australian Government’s official ban on overseas travel, for departures between April and June were down 41.2%.

According to ForwardKeys, bookings are weakest for travel during Apr-2020, progressively getting better as the months go on, with May-2020 being less negative than Apr-2020, and June less negative than May-2020.

“We are seeing travellers cancel their trips in the near future, however they are holding off cancelling their trips booked for later on in the year.

They are still holding onto hope that the situation will get better and they will still be able to travel in later months”, ForwardKeys added.

Forward bookings for Australian air arrivals in worldwide regions, Apr–Jun-2020 (% change year-on-year) 

Inbound forward bookings in Asia are yet to find a floor

According to ForwardKeys, the inbound bookings to Australia were down -49.9% as of 18 March 2020.

Australia has suffered a ‘quadruple whammy’ – droughts, bushfires, floods, and now COVID-19, which have all been “negatively affecting international arrivals into Australia for the past few months. Right when we start to see a recovery from the previous event, the next event hits and destroys any signs of recovery”.

Bookings for the past four weeks have progressively been getting worse, with the latest week seeing the worst week of bookings ever recorded to Australia in recent history.

Top destinations by volumes for Australian arrivals to Asia, Mar-2020–Jun-2020 (% change year-on-year)

3. Meetings and Events: Cancellation of meetings and events has a huge impact - PredictHQ

The cancellation and postponement trend for major and significant events continues to soar, according to demand intelligence company, PredictHQ. The big data company noted however, ‘we have noticed that many are mis-characterising this as cancellations only.

The good news for airlines is that the vast majority of the events have been postponed and will be rescheduled once the virus’s trajectory is clearer’.

For example, looking at one of the highest impact categories - sports -  in Mar-2020 to May-2020 only 15% of major and significant events have been cancelled, with around 85% postponed at the time of writing. 

The graph below shows events cancellations or postponements in Australia over the past six months.The full realisation of the wider impact of COVID-19 only became clearly apparent in early Feb-2020, when the flurry of cancellations and sdpostponements began.

The trend is similar to worldwide: major and significant events are rarely cancelled, but COVID-19 is causing a surge in these changes.

Major + significant event cancellations and postponements in Australia (% change year-on-year)

The table below lists the largest events that have been cancelled or postponed because of the coronavirus in Australia.

They contain a range of events including festivals, community events and conferences.

PredictHQ used its Aviation Rank™ models to identify these events that will drive tens of thousands of airline ticket bookings.

The 10 largest cancelled or postponed events in Australia due to the coronavirus

Event

Date

Attendance

Control Center Link

Vivid Sydney

May 22, 2020 - Jun 13, 2020

2,300,000

https://events.predicthq.com/events/NkJTJG8WHQXkajguQc

Sydney Royal Easter Show

Apr 3, 2020 - Apr 14, 2020

900,000

https://events.predicthq.com/events/UkiecX7D6ZYRKyLBVY

Melbourne International Comedy Festival

Mar 25, 2020 - Apr 19, 2020

770,000

https://events.predicthq.com/events/Ga75vVcWFWeVnKzoWV

Australian F1 Grand Prix

Mar 12, 2020 - Mar 15, 2020

300,000

https://events.predicthq.com/events/XJa5cVDLBLeo6AaoZi

Skyfire Festival

Mar 14

100,000

https://events.predicthq.com/events/RvBxZxuCdrxv7wceMM

Good Friday Appeal Kids Day Out

Apr 10, 2020

85,000

https://events.predicthq.com/events/FJzaRgFuYQggud2VQJ

CMC Rocks Queensland

Mar 20, 2020 - Mar 22, 2020

60,000

https://events.predicthq.com/events/gkpSzDvyr8EcWkESpB

Victoria's Multicultural Festival

Mar 29, 2020

45,000

https://events.predicthq.com/events/7sCmVZypycHR7yMPjE

Download Festival - Sydney

Mar 21, 2020

30,000

https://events.predicthq.com/events/Z8bXhCoND4NMi2uihG

Download Festival - Melbourne

Mar 20, 2020

30,000

https://events.predicthq.com/events/ZyhxpZ9dngZmEWEphX

AWS Summit Sydney

Mar 31, 2020 - Apr 2, 2020

12,500

https://events.predicthq.com/events/DVrFdhsVwpboUBAnzf

5. Airline and travel share prices tumble

The result has been carnage for listed airline, airport and travel stocks in Australia, falling by 40-80% or more since the start of the year. There may have been some stabilisation in recent days, reflecting government support for the airline sector, but it’s too early to call an end to the stock market rout.

The uncomfortable outlook

  • Unsurprisingly there is little good news in our indicators at this stage of the violent COVID-19 driven downturn.  Bad news is not hard to find at this time.
  • But there is some mild optimism among would-be travellers, with at least a moderating of cancellations as we look three or four months out.
  • The effects of blanket cancellation of sports and almost all events will be felt at least for several months, particularly where international travel is involved.
  • In these circumstances, with many national borders effectively closed, travel search numbers are well down
  • As noted in the introduction, the largest cause for optimism is that most major events have not been cancelled, merely postponed, implying a significant reason for travel to recommence, once conditions improve. In some respects this relates to contractual obligations, as accommodation and venues struggle under these conditions, but there is the prospect of a quick recovery, again where international travel is not the key element.

Regular updates

CAPA will update the data presented in this report and regularly add more data points as they become available.

Please visit the CAPA website for a Daily COVID-19 wrap and other analysis reports. CAPA Members can access all capacity data presented here via the CAPA Membership service – for details contact membership@centreforaviation.com

About our Data Partners

This report is prepared with thanks to our partners 3Victors, ForwardKeys, PredictHQ, OAG and CAPA Membership. We encourage you to check out their resources and services at the links below.

Image result for 3 victors travel logo

3Victors is a Travel Big Data company ingesting daily over 500 million worldwide travel searches and 90 billion itineraries in real-time from the world’s largest reservation systems. Providing data analytic solutions specific to customers’ needs with insights into market trends, pricing, and lowest fares. For more information click here: https://www.3victors.com/

ForwardKeys is a big data and business intelligence company offering a new approach to traveller operational business. ForwardKeys leverages global flight reservations plus other data to monitor and qualify traveller flows, understand global demand, and forecast trends, analysing millions of daily flights. For more information click here

The demand intelligence company PredictHQ aggregates data about millions of events from hundreds of data sources. PredictHQ’s ‘Aviation Rank’ tool helps users know which events will impact airline demand so revenue teams can make decisions better, faster and at scale. PredictHQ’s proprietary ranking algorithms incorporate historical aviation bookings with PredictHQ event data and identify which will have the most impact on air travel. For more information click here

OAG

OAG is a leading global travel data provider, that has been powering the growth and innovation of the air travel ecosystem since 1929.  

Every day, OAG supports millions of journeys across the globe, enabling a simpler, seamless and more enjoyable travel experience. With the world’s largest network of schedules and status data, and leading-edge analytics tools, OAG enables its customers to make smarter decisions, better adapt to change and create exceptional customer experiences.  

Find out more: https://www.oag.com/

CAPA Membership provides global aggregated aviation news, analysis and data as it happens, with access to a comprehensive suite of tools that can be customised to clients’ needs. For more information click here.

Have an insight to share?

Contribute to our industry’s understanding of the COVID-19 crisis by sharing your aggregated data points with us. We will gladly add them to the next edition. Please contact Derek Sadubin, Managing Director, CAPA, at ds@centreforaviation.com

Thank you.

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