Meeting of minds - looking back at 2022, looking forward to 2023

After an encouraging first two decades of the 21st Century that had provided a fertile environment to support the growth of air travel, nobody was prepared for the rollercoaster ride that the initial years of the 2020s have offered. It was the proverbial calm before the storm. But this was not like any storm encountered previously.

As the coronavirus crisis evolved from a small news story into a global pandemic, air travel came to a near standstill. The calm climb of the previous decades came to an immediate stop and an industry collapsed into freefall. This was a vertical drop. And it didn’t stop, wiping years of growth in a matter of days.

It suddenly became all about survival. Costs were quickly jettisoned as businesses restructured in preparation for recovery. That path has become complicated by a mutating virus and cautious governments, but an increasingly vaccinated population and strong pent-up demand is already delivering growth in most geographic markets.

As sentiment to travel rises, the industry is growing again. Global domestic air capacity is already nearing pre-pandemic levels and peaking above 2019 levels in some markets. International air travel is following behind as travel restrictions have been slowly lifted, but where restrictions remain continue to blunt performance.

But just as some confidence was starting to return, Russia’s invasion of Ukraine and the rising cost of fuel has impacted a recovery path that will also be influenced by technological developments and sustainability considerations.

Willie Walsh, director general of International Air Transport Association (IATA), highlighted at the airline body’s 2022 AGM, that the air transport industry is constantly facing headwinds. It is clear that the latest decade has concentrated these into a smaller window of time than would have been wanted.

  • How strong are these headwinds and do airlines now have a more positive outlook than 12 months earlier?

  • As COVID-19 has moved from pandemic to endemic status are airlines seeing any permanent changes to the industry?

  • What is the outlook for 2023 and beyond?

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