Strong air travel recovery in the United States, Europe, Latin America but Asia lags behind

According to the International Air Transport Association (IATA), international air travel excluding the Asia-Pacific region is making a strong recovery this year, which is “significantly behind”.

“Last year, international travel was about 25% of where it was in 2019. Worldwide, in the first quarter of this year, it grew 42%,” Willie Walsh, director general of the industry body, told Squawk Box Asia. On tuesday.

“Actually, what we’re seeing is very strong growth rates in some markets from the United States, Europe, Latin America, touching about 60%.”

Shares of United Airlines, for example, added more than 3% to Monday’s extended transaction after the company released an update on its second-quarter outlook.

In contrast, air travel in Asia “is only 13% of where it was in 2019,” Walsh added.

China is still pursuing its zero-cove policy, with Shanghai and Beijing imposing restrictions on business and travel. But China’s travel ban will not play a major role in restoring global air travel, he said.

“The positive thing is that many other markets have opened up so airlines have the opportunity to expand their network … in those markets,” he added.

‘Premium’ travel optic

Asked if the business division of the airline industry would return to pre-epidemic levels, Walsh said recovery would be “a little slower”.

“We see a lot of business travel in the economy … business recovery is a bit behind,” he added.

“But I think everyone will now agree that it will not be a fundamental structural change that we all believe could happen.”

In contrast, he notes that there are more “premium” travelers traveling in first class or business class.

“It points to a very important segment of the market, which we call premium leisure. We see that people there have higher disposable income and are willing to pay for that premium and experience.”

“I fully expect the premium [to] Continue to recover quickly, “Walsh added.

To meet that demand, airlines are offering luxury cabins in hopes of shelling out high-paying customers for more space on board.

For example, Singapore Airlines has observed that business-class seats on planes are being sold ahead of economy seats, which is “the opposite of a pre-epidemic trend.”

Challenges for air cargo

Even with the recovery momentum for air travel, IATA sees “some challenges” for the global air cargo market.

“We had record performance in 2021 and continue to improve in 2022. However, it is slightly behind the 2021 high.”

Walsh blamed Russia for the invasion of Ukraine. “Russian cargo operators carried a lot of goods, security was completely destroyed,” he added.

The IATA said in a report that the volume of air cargo in March decreased by 5.2% year-on-year.

“The war in Ukraine led to a decline in the capacity used to provide services in Europe, as several airlines from Ukraine and Russia were important carriers in the region,” it wrote.

“The continued expansion of Omicron in Asia, and especially in China, is creating new lockdowns and labor shortages. These have strongly affected manufacturing centers in China and Asia, resulting in loss of air cargo transportation to markets in the region.”

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