PETALING JAYA: As restrictions on movements have mostly been lifted worldwide, the lockdown weary travel bug bites again.
Airlines around the world are responding with resumption of flights on traditional routes as well as introducing new ones.
And to be the first to lift off, carriers everywhere have been conjuring up new tricks or recycling old ones.
For instance, Singapore’s Jetstar had a Children’s Day competition that promised a family trip to Phuket for the winner while Air France launched a quiz on Sept 26 that gave a free trip for two to New York for all correct answers, according to airline industry news website Travel Radar.
Back in Malaysia, the two main flag bearers — full service Malaysia Airlines and low-cost carrier AirAsia — are quickly filling up seats in their cabins again.
For both, grounded planes are already taking off, and apart from returning to their traditional destinations, they are flying to new ones as well.
For instance, Malaysia Airlines now flies twice a day to London, up from only 11 flights a week in March.
Its capacity has reached 76% of its 2019 level and is expected to touch 82% at the end of the year as it adds new destinations in its flight path, such as Doha and Haneda, Tokyo.
The four Capital A Bhd airlines, namely AirAsia Malaysia, AirAsia Indonesia, AirAsia Thailand and AirAsia Philippines, have not only resumed flying the traditional routes that were suspended during the Covid-19 pandemic but are also taking off to new destinations.
The passenger load factor in its four airlines rose to 9.9 million in the third quarter of this year (Q3 2022), up 54% from its pre-pandemic level and 36% more quarter-on-quarter.
Data from Malaysia Airports Holdings Bhd (MAHB) only reinforces these signs of recovery.
It shows that passenger traffic has recovered quite substantially. As of September 2022, traffic in the domestic segment has reached 81% of the level achieved in the same month of 2019, while in the international segment, it was at 46%.
The revival in air travel has also brought real benefits for the aerospace sector.
For instance, airlines are beginning to take delivery of new aircraft. “There is already a backlog of 40,000 planes worldwide that airlines are waiting for,” Malaysia Aerospace Industry Association president Naguib Mohd Nor told FMT Business.
In the area of maintenance, business has picked up as more aircraft are up in the air again. “Conditions are almost back to the pre-Covid-19 level,” Naguib said.
The research unit of MIDF Amanah Investment Bank Bhd told FMT Business that on a cumulative basis, Malaysia’s domestic traffic has recovered to 67% and the international traffic to 23% of the level recorded in September 2019.
However, it is expected to continue to face headwinds. “China’s zero Covid-19 policy makes it a laggard given that the north Asian (including China) sector historically contributed close to 25% of the traffic at KLIA.
Chinese tourists are also the biggest spenders at duty free shops, the research unit said.
The weaker ringgit may also pose a challenge, given that jet fuel is priced in US dollars, MIDF said.
For Capital A, for instance, close to 50% of the aviation group’s expenses are denominated in US dollars, it said, but a downtrend in crude oil prices could soften the financial impact.
On the other hand, there is still no evidence of a slowdown in air travel despite expectations of a recession going forward.
Even with fares elevated as airlines began to impose fuel charges earlier in t
he year, passenger traffic continued to recover. MIDF attributed this to a shift in consumption from goods to services post-lockdown.
For now, there is optimism ahead.
In its latest analysis published this month, consulting services provider Bain & Company forecasts revenue for the airline industry worldwide will reach US$525 billion (RM2.4 trillion) this year, 84% of the US$666 billion (RM3.1 trillion) achieved in 2019.
It said that while travel between Europe and North America is expected to continue to outperform international travel to and from Asia, growth within Europe could slow down within the next 18 months.
All the same, mounting recession in key economies and turbulence in the oil market could upend a recovery.