Super summer makes the airlines forget everything about corona and crisis

Flying would never return to the old level after corona, it was predicted. The summer of 2022 proved otherwise, certainly in an economic sense.

Repaid state aid and better results than in the relatively carefree pre-corona summer of 2019: European airlines seem to have fully recovered from the pandemic after last summer. Even skyrocketing petroleum prices, persistent staffing problems at some major airports, galloping inflation, the war in Ukraine and ongoing corona lockdowns in China cannot harm the quickly regained confidence.

The essence

  • European aviation consumed all corona worries last summer.
  • Many airlines were already doing better than in the last pre-corona summer 2019.
  • Many airlines have also already repaid the corona state aid.
  • There is hardly any fear of an impending recession: Both Lufthansa and British Airways’ parent company AIG are raising their profit forecast for the rest of the year.

As the largest airline in Europe, Ryanair proved again on Monday how amazing the past summer season was. The low-cost car carried 11 percent more passengers than in the summer of 2019 before corona and also managed to make these travelers pay 14 percent higher ticket prices. This led to a tripling of revenue over the past six months to 6.6 billion euros and a profit of 1.37 billion euros.

This makes Ryanair the best performing large airline in Europe. This is largely due to its strategy of not cutting the workforce during the corona crisis, unlike many other European airlines. For example, the Irish low-cost fighter jet was able to take full advantage of the exploding demand for air travel after the lifting of the corona restrictions at the beginning of this year.

73

Boeing 737

Ryanair has received a new aircraft from the American aircraft manufacturer Boeing almost every week for the past six months.

At the same time, the slow-start delivery of hundreds of new Boeing aircraft has reached cruising speed. Last year, 73 new planes arrived. Over the next six months, one aircraft will be added each week, bringing the fleet to 124 new Boeings by next summer.

Occupancy rate

Also, no one beats Ryanair in terms of the load factor of their planes. While all European airlines are very happy with less than 20 percent of seats remaining empty on an average flight, Ryanair achieved an occupancy rate of 94 percent last summer. This is important because the rule of thumb in aviation is that money is only made on a flight if more than three-quarters of the seats are full.

In addition, Ryanair also considers itself more recession-proof than its competitors. Chief executive Michael O’Leary expects to be able to limit the classic winter season losses for the rest of Ryanair’s financial year, which runs until March 31. As a result, the annual profit would amount to 1 to 1.2 billion euros. The budget flyer hopes to welcome 168 million travelers, a slight increase on the previous forecast.



Consumers are not stopping flying, they are just more aware of the price. Like Aldi, Lidl or IKEA, we will gain market share in this climate.

Michael O’Leary

CEO Ryanair

“Concerns about the impact of a recession on our business model are being greatly exaggerated,” O’Leary said. “Consumers will not stop flying, they are just more aware of the price. And like Aldi, Lidl or IKEA, we will gain market share in this climate.’

Ryanair also benefits from its focus on the European market, which means it is not affected by the still weak demand for flights to the Far East. Air traffic to China in particular has been halted due to Beijing’s zero-tolerance policy towards corona and the associated strict lockdowns.

Higher earnings expectation

The other major European airlines have also processed the corona boom. Brussels Airlines’ parent company Lufthansa last month raised its full-year earnings forecast as summer operating profit of 1.1 billion euros turned out to be more than double what the German group had expected.

AIG, the group of British Airways, Iberia, Vueling and Aer Lingus, also raised its profit forecast for the rest of the year. Despite all the staff shortages at UK airports and the associated cancellation of thousands of flights, slightly more passengers were carried last summer than in the summer of 2019.

State aid

At Air France-KLM, even the structural problem child Air France made the beautiful weather. The Corona clean-up has made the French state-owned company a lot leaner. In addition, Air France took advantage of the French government’s commitment to cancel all domestic flights from Paris-Orly to destinations reachable by TGV in a maximum of 2.5 hours. These flights from Paris to Lyon, Bordeaux and Nantes, among others, were unprofitable, and the remaining aircraft could be used on profitable routes.

The billions of euros in state aid that governments had to give their airlines in the full corona crisis have already been largely repaid. KLM and Lufthansa already paid out their bailout billions at the beginning of this year. After this summer, Brussels Airlines announced that it would repay the 290 million euros in state aid and the two corresponding government representatives on the board by the end of this year.

At the same time, the Belgian airline, which has been reduced by a quarter, is working again with growth plans. Planes were scrapped during corona, but a few new planes were added this summer. CEO Peter Gerber sees growth in the prestigious destinations to East Africa in particular.

Air Belgium is significantly cutting back on the offer

Air Belgium will cut deeply in its offer at the beginning of next year. The Belgian-Chinese airline is canceling almost all flights to the Antilles due to high fuel prices.

Due to the increased costs, the airline was already forced to reduce capacity in the summer and combine flights to several destinations: those to the French islands of Guadeloupe and Martinique, and those to Punta Cana in the Dominican Republic with those to the Dutch island of Curaçao. .

Now society goes a step further. She deplores that fuel prices in the Dominican Republic are more than half and passenger taxes three times higher than in Brussels. On top of that comes the loss of value of the euro against the dollar. Punta Cana airport also obliges passengers bound for Curaçao to disembark and re-board as a result of taxes being imposed on them as well.

Until mid-January, Air Belgium will schedule one or two more flights to Curaçao and Punta Cana. After that, it suspends the connection, except during spring break in February and March. It has not yet been decided whether the destinations will again be included in the summer offer. The Dutch island of Bonaire, which is also served from Brussels with a triangular connection via Curaçao, also disappears from the flight schedule.

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