The continuing impact of COVID-19 is giving little relief for airline executives with ticket refunds keeping pace with new ticket sales globally, according to Matthew Tringham, chief strategy and produce officer at Skytra, which today released its second survey on ticket prices, in conjunction with IATA.
“Looking at the specific COVID-19 indicators, what we are seeing is that the story of last week is essentially continuing. Refunds are keeping pace with new issues and markets across the globe are experiencing an average of -90% to -104% in terms of net revenues, so there is no light at the end of the tunnel, yet,” said Tringham speaking to Airline Economics.
Not only have ticket sales for the last week remained static with revenues for the industry effectively 100% lower than this period last year, forward bookings are looking weak also, according to the Skytra/IATA data.
Again refunds are outstripping sales, leading to values of less than -100% when compared to 2019. There are some bright spots with routes Asia to Europe, and Asia to North America, seeing a slight rise in sales for May, although this is still 75% less than last year. Likewise bookings in North America for November and December are seeing an increase, although again at lower rates than the corresponding period last year.
Despite the wholesale slashing of capacity combined with a precipitous drop in passenger demand, pricing is still coming under pressure according to Tringham, with fares at a significant discount to 2019.
“The price of air travel is clearly lower than would be normal for this time of year. Particularly in Europe and North America. European average prices, depending on how you look at it, are currently down 25% and whilst North America had a strong start to the year, pricing is now approximately 30% lower than expected levels,” said Tringham.