Air fares could be 30 percent higher this summer than before the corona pandemic: what’s going on?

Now that corona rules have almost disappeared in many countries, many people have booked a flight holiday this summer. The prices of such a flight are rising. Price increases of up to 30 percent relative to pre-pandemic levels are not ruled out.

After more than two years, the tourism sector can breathe again. Now that many countries have abolished or relaxed the corona rules, tourists are once again finding their way to the airports. “Demand is phenomenal,” Delta Airlines CEO Ed Bastian said at a recent industry conference. He noted that rates could be 30 percent higher this summer than before the pandemic.

Global rise

No one is spared the rising airline tickets. Travel company Travix has calculated that travelers who flew with low-cost airlines such as Ryanair, Transavia, Vueling and EasyJet in May, on average, had to pay 60.5 percent more for their trip than in January. During the same period, prices on KLM, Lufthansa and Brussels Airlines rose by 21 percent.

A study by the Mastercard Economics Institute shows that the price of flights from Singapore was on average 27 percent higher in April than in 2019, while flights from Australia were 20 percent more expensive. “Increasingly, travelers book their tickets months in advance because they’re worried about the cost of a last – minute purchase,” notes David Mann, chief economist at the Mastercard Economics Institute.

Fly on the ground

Despite the growing demand, the airlines are quite cautious about putting all their planes back into operation. This is especially true for large aircraft such as Airbus SE’s A380 superjumbos and Boeing Co’s older 747-8s, as airlines are switching to more fuel-efficient models such as A350s and 787 Dreamliners. The pressure is greatest in Asia, where easing of coronary restrictions has been slowest. For example, Shanghai and Beijing have recently relaxed the rules following a new corona outbreak.

“After having varied and unstable government policies over the past two years, it will take airlines time to rebuild their fleet, as many restrictions were not eased until May,” said Subhas Menon, director general of the Association of Asia Pacific Airlines. against the airline. news agency Bloomberg

Lack of staff

Meanwhile, airlines are having trouble keeping up with rising demand. There have been many layoffs in the aviation sector due to the corona crisis. So now the airlines have to look for new staff to fill the vacancies. The search is anything but smooth. As a result, some airlines are forced to cancel flights.

The Dutch airline KLM, for example, had to cancel a couple of flights last weekend. No more passengers were flown to Amsterdam from European destinations on Saturday. In this way, KLM wanted to contribute to “a manageable situation at the airport and in its own operations.”

Rising fuel prices

It should come as no surprise that the high fuel prices are partly to blame for the more expensive flights. Due to the increased demand for the corona pandemic and the war in Ukraine, oil prices have risen markedly. The price of a barrel of Brent oil is currently $ 119, compared to about $ 78 at the beginning of this year.

Jet fuel now represents a staggering 38 percent of the cost to an average airline, up from 27 percent in the years before 2019. For some low-cost airlines, this figure could reach as high as 50 percent.

Some tour operators pass these prices on to the consumer via a fuel surcharge, even if you have booked the trip months in advance. Those who only book a flight do not have to pay such a surcharge subsequently. In that case, the price you pay when buying a plane ticket applies.

Compensation for corona pandemic loss

Aviation is a capital-intensive industry with historically thin margins. The Corona pandemic has therefore left deep wounds in that sector. According to Bloomberg, airlines worldwide have lost more than $ 200 billion in the three years to 2022.

Higher prices allow airlines to offset their losses and make a profit again.

(mah)

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