European airline 4Q2021 schedules point to next step up in recovery

Summary

• Europe has 22.6 million seats this week, down 33% vs 33.6 million in the same week of 2019. Europe remains fourth behind N. America, LatAm & Africa.
• Europe's 4Q2021 capacity projection has stabilised at 73% of 2019 levels, up from 64% in 3Q2021.
• The passenger traffic curve still trails the capacity trend. In mid Sep-2021 traffic was down by 39% vs 2019, compared with -34% for capacity.
• Europe's traffic recovery has a north-south divide, with Southern Europe stronger, while non-EU Eastern Europe is the strongest region.

Europe has 22.6 million seats vs 33.6 million in 2019 - down 33%

In the week commencing 11-Oct-2021 total European seat capacity is scheduled to be 22.6 million, according to OAG schedules and CAPA seat configurations.

This is 32.7% below the 33.6 million seats of the equivalent week of 2019. This is just 0.3ppts better than last week's -33.0%.

The trend has now been stuck in the range of -34.7% to -32.7% for 11 consecutive weeks. This is the most positive range since before the coronavirus pandemic, but Europe's capacity recovery has lost momentum after making strong gains in 2021 from April to July.

This week's total seat capacity for Europe is split between 6.6 million domestic seats, versus 7.7 million in the equivalent week of 2019; and 16.0 million international seats, versus 25.9 million.

Europe's domestic seats are down by 14.2% versus 2019, 1.0ppt worse than last week's -14.3%.

International seat capacity is down by 38.1% versus 2019, compared with last week's -38.6%.

Europe: percentage change in weekly airline seat capacity vs equivalent week of 2019, week of 06-Jan-20 to week of 11-Oct-2021

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Source: CAPA - Centre for Aviation, OAG.

Europe remains fourth among world regions by capacity as percentage of 2019's

Europe remains in fourth place in the ranking of regions measured by seats as a percentage of 2019 levels.

The Middle East has slipped to the bottom as the worst-performing region, with capacity down by 38.5% versus 2019 this week. It is only just below Asia Pacific, where seat count is down by 38.3%

Africa's seat count is down by 30.4%, Latin America's by 23.2%, and North America's by 18.5%.

Asia Pacific, North America, Africa and Latin America have taken an upward step in the trend this week, whereas the Middle East has taken a downward step. Europe is broadly flat on last week (week of 04-Oct-2021).

Percentage change in passenger seat capacity vs 2019 by region, week of 30-Mar-2020 to week of 11-Oct-2021

Source: CAPA - Centre for Aviation, OAG.

Europe's 4Q2021 capacity projection is unchanged at 73% of 2019 levels

According to data from OAG and CAPA, capacity as a percentage of 2019 levels has improved with each successive quarter of 2021. It was 27% in 1Q2021, 33% in 2Q2021 and 64% for 3Q2021.

Schedules filed for 4Q2021 project a further upward step to 73% of 4Q2019 levels. This is virtually unchanged from the capacity planned for the final quarter of 2021 a week ago.

Annual 2021 seat capacity for Europe is projected to be 51% of 2019 levels - only 9ppts better than the outturn of 42% of 2019 seats for 2020.

Although Europe's seat capacity has been stuck at a similar percentage of 2019 levels for more than two months, the apparent stabilisation in the outlook for 4Q2021 capacity is encouraging.

The passenger traffic curve still trails the capacity trend

Just as Europe's capacity recovery has remained on a plateau, so has passenger traffic. Moreover, traffic continues to be at a lower percentage of 2019 levels.

According to preliminary data from ACI Europe covering 86% of European passenger traffic, passenger numbers were down by 39% versus 2019 in the week commencing 19-Sep-2021 (the most recent week for which data are available).

This was 1ppt worse than in the previous four weeks and the seventh successive week of passenger traffic being down a percentage point either side of -38%.

The passenger trend was 5ppts below the seat trend in the week of 19-Sep-2021.

The average gap between the two curves was 7ppts in 1Q2021, widening to 9ppts in 2Q2021. However, more encouragingly, the average gap narrowed to 4ppts in Aug-2021 and the first four weeks of Sep-2021.

This is the closest that the passenger trend has been to the capacity trend since the start of the pandemic.

Europe: percentage change in weekly seat capacity and passenger numbers vs 2019 levels

*ACI Europe passenger data week starts one day before the OAG schedules data week.
Source: CAPA - Centre for Aviation, OAG, Airports Council International Europe (ACI Europe).

Europe's traffic recovery has a north-south divide…

There are considerable differences in the rate of recovery of passenger traffic in different parts of Europe, according to the most recent data from ACI Europe. The broad split between northern and southern Europe remains, with traffic in the south of the continent recovering to higher percentages of 2019 levels.

UK airport passenger traffic was down by 59% in the week of 19-Sep-2021, which was the worst of any major market in Europe. This is a significant improvement on its level of -72% in the week of 1-Aug-2021, but little changed from -60% in the week of 5-Sep-2021.

In Germany, passenger traffic was down by 49%, compared with -48% two weeks earlier, while the Nordic and Baltic region was down 47%, which was a slight improvement from -50% two weeks earlier.

In Eastern EU member states traffic was 43% below 2019's, compared with -42% at the start of Aug-2021.

In the EU/EEA/Switzerland/UK combined region, the passenger traffic recovery slipped to -43% in the week of 19-Sep-2021, from -42% in the week of 5-Sep-2021.

In Benelux, it deteriorated to -43% from -38%, and in France it was 42% below 2019 passenger traffic, compared with -41%.

Italy passenger traffic was down by 39% versus 2019: the best rate among Western Europe's large nations and in line with the average for all Europe, but down from -36% two weeks earlier.

The Southern Europe region was enjoying a stronger traffic recovery, with passenger numbers 32% below 2019 levels in the week of 19-Sep-2021. However, this had slipped from -30% two weeks earlier.

…and is still strongest in non-EU Eastern Europe

The recovery in airport passenger numbers as a percentage of pre-pandemic levels continued to be the strongest outside the EU/EEA/Switzerland/UK, i.e. in the nations of Eastern Europe, where they were only 23% below 2019 levels in the week of 19-Sep-2021.

However, this was a slide from -21% in the week of 5-Sep-2021 and -17% at the start of Aug-2021.

European airport passenger traffic: percentage change from 2019, week of 1-Aug-2021, week of 5-Sep-2021 and week of 19-Sep-2021

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Source: CAPA - Centre for Aviation, OAG, Airports Council International Europe (ACI Europe).

There are reasons for optimism that 4Q2021 will take the next upward step

The recovery in European aviation, measured both by seat capacity and passenger traffic as a percentage of 2019 levels, has been range-bound for more than two months in 2021.

However, two factors in this week's analysis give signs of encouragement that the next upward step in the recovery will take place in 4Q2021.

The first of these is the narrowing of the gap between the traffic and capacity curves in Aug-2021 and Sep-2021 compared with earlier months.

The second is the stabilisation of capacity scheduled for 4Q2021, in contrast to previous patterns of regular cuts to capacity projections as flight schedules have drawn nearer.