High Fares, Rising Economic Worries Hurting Airline Recovery

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Jun 21. Pent-up demand from the pandemic means consumers are weathering high airfares, but as summer ends and inflation and interest rate rises begin to bite, there are growing questions over whether the appetite for travel is sustainable.

Global airlines are now expected to post a $9.7 billion loss in 2022, a sharp improvement from a revised $42.1 billion loss in 2021, the International Air Transport Association (IATA) said on Monday, and to possibly claw their way back to profit in 2023.

But earnings remain well short of pre-pandemic levels as highly indebted carriers grapple with fresh challenges from rising fuel costs and high wages bills that they are attempting to pass on to consumers in the form of higher fares.

Industry leaders gathering at IATA’s annual meeting in Doha said bookings generally looked very strong for the next few months, but there was less certainty beyond that.

Source: Reuters

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130670cookie-checkHigh Fares, Rising Economic Worries Hurting Airline Recovery