Tourism sector may be affected by a lack of capacity

The International Air Transport Association (IATA) this week reported a significant increase in air travel demand for March 2023, with total traffic rising 52.4 per cent compared to the same month in 2022.

Although this is considered to be a positive sign for the aviation industry, which has been hit hard by the Covid-19 pandemic, the association also warned that there may not be enough capacity to meet tourist demand, primarily due to labour shortages and supply chain concerns.

According to the report, domestic traffic rose 34.1 per cent compared to the previous year, and total domestic traffic in March 2023 was almost at the same level as in March 2019.

Meanwhile, international traffic increased by 68.9 per cent, with all markets recording healthy growth, particularly in the Asia-Pacific region.

“The calendar year’s first quarter ended on a strong note for air travel demand. Domestic markets have been near their pre-pandemic levels for months. And for international travel two key waypoints were topped,” IATA director general Willie Walsh said.

“First, demand increased by 3.5 percentage points compared to the previous month’s growth, to reach 81.6 per cent of pre-Covid levels,” he added.

Walsh explained that this was led by a near-tripling of demand for Asia-Pacific carriers as China’s re-opening took hold, while efficiency is also improving, with international load factors reaching 81.3 per cent.

“Even more importantly, ticket sales for both domestic and international travel give every indication that strong growth will continue into the peak Northern Hemisphere summer travel season,” Walsh said

Asia-Pacific airlines had a remarkable 283.1 per cent increase in traffic compared to March 2022, reflecting the lifting of travel restrictions in the region.

European carriers recorded a 38.5 per cent traffic rise, while Middle Eastern airlines saw a 43.1 per cent traffic increase.

North American carriers’ traffic increased by 51.6 per cent in March 2023 compared to the same period last year, with the highest load factor of 84.8 per cent among all regions.

Latin American airlines had a 36.5 per cent traffic increase, and African airlines saw a 71.7 per cent rise in traffic, the second-highest among all regions.

“As traveller expectations build towards the peak Northern Hemisphere summer travel season, airlines are doing their best to meet the desire and need to fly. Unfortunately, a lack of capacity means that some of those travellers may be disappointed,” Walsh stated.

“Part of this capacity shortfall is attributable to the widely reported labour shortages impacting many parts of the aviation value chain, as well as supply chain issues affecting the aircraft manufacturing sector that is resulting in aircraft delivery delays,” he added.

However, Walsh explained that a significant share of recent flight cancellations, primarily in Europe, are owing to job actions by air traffic controllers and others.

“These irresponsible actions resulted in thousands of unnecessary cancellations in March,” Walsh noted.

“This is unacceptable and should not be tolerated by the authorities,” the IATA chief concluded.