What are the four conditions needed to enable further air travel? Or, put another way: What will drive air travel in 2022? Discussing the answer to the question during a recent panel discussion were a panel of experts comprised of John Grant, the widely known chief analyst at OAG, the acknowledge global authority on the airline industry; Becca Rowland, partner, Midas Aviation; and Matthew Findlay, director, global markets, Ailevon Pacific Aviation Consulting.
The overall answer to what will enable, or drive, the global airline industry in 2022 was and is clear and direct, the OAG panel agreed: vaccinated travelers, frictionless borders, functioning airlines and disposable income.
Specific answers ranged from: domestic airlines have fared better and will continue to do so, international travel to leisure travel will lead corporate travel in a post-pandemic recover, and airline employee sick leave “is going through the roof” and having an impact felt throughout the airline industry.
Following are INBOUND highlights from the discussion
● FRICTIONLESS BORDERS: Travel restrictions still a major impediment to travel We have calculated how many changes to the Stringency Index for each country have taken place since January 2020 – a high level of changes means that the aviation industry and travelers have had to make more adjustments to travel plans
● THE ROLE OF VACCINATIONS: Necessary but not sufficient
—59.5 percent of global population have had on ore more COVID-19 vaccinations
—High-income countries average 77 percent
—Low-income countries average 9.5 percent
Proportion of Populations Wholly or Partially Vaccinated*
| World Region | Percentage Vaccinated |
| South America | 76.6% |
| North America | 68.7% |
| Asia | 68.7% |
| Europe | 66.0% |
| Oceania | 61.6% |
| Africa | 15.2% |
*© Australian Bureau of Statistics, GeoNames, Microsoft, Navinfo, OpenStreetMap, TomTom (Powered by Bing)
● FRICTIONLESS BORDERS: Travel restrictions still a major impediment to travel.
—OAG calculated how many changes to the Stringency Index for each country have taken place since January 2020 – a high level of changes means that the aviation industry and travelers have had to make more adjustments to travel plans.
—Recovery taking place across all Top 15 countries for capacity in 2021, albeit drawn out.
Mexico ended 2021 close to 2019 levels.
—Nine of the Top 15, including USA and China, within 20 percent of 2019 levels of capacity in December.
—2021 Recovery slowest in Indonesia, Australia, Germany Japan and UK.
Source: Oxford COVID-19 Government Response Tracker, Blavatnik School of Government, University of Oxford, update from January 12, 2022
©2022 OAG Aviation Worldwide Limited. All rights reserved.
● FRICTIONLESS BORDERS: Passports & Digital Health Apps
—IATA TravelPASS
—Verifly
—EU Digital COVID Certificate: Provides digital proof of vaccination, negative test result or recovery from COVID-19. Rules in place from 1 February 2022. Bulgaria, Croatia, the Czech Republic, Denmark, Germany, Greece, Poland early adopters. 33 non-EU countries have joined the scheme based on EU equivalence decisions.
— IBM Digital Health Pass: IBM’s solution if integrated into Traveler ID for Safe Travel, Amadeus’ digital health verification solution
—Common Pass for Aruba and Hawai’i
● FUNCTIONING AIRLINES: State of airline health
Schedules continue to be subject to change.
—Airlines carrying plenty of debt as they start 2022.
—Financial support & stimulus packages largely ending now.
—Staffing issues including due to staff sickness.
—Fuel price highest in many months – Moody’s forecast Brent price for 2022 to be around 2018 levels when the industry was profitable
—Tourism bodies likely to get monetary stimulus.
● JET FUEL PRICE: Fuel is 63 percent higher than a year ago
—Jet fuel price US$97.4 per barrel.
—63 percent higher than a year ago.
—Average price in 2021 was US$77.8/bbl.
—Impact on 2021 fuel bill US$48.9 billion, according to IATA.
● SOME SIZEABLE Q1 CAPACITY REDUCTIONS:
—Many airlines have reduced capacity for January-March over the first three weeks of 2022.
—These reductions may be operational rather than based on demand: i.e., to manage staff sickness.
—Cathay Pacific capacity for February and March has been reduced by about 1/3 since end December.
—Qantas capacity for January is down 21 percent since December 27.
—Virgin Australia capacity reduced by 23 percent for January and 30 percent for February.
—Chinese carriers have reduced January capacity by 10 percent since December 27th.
—IndiGo scaling back Q1 capacity by 15-30 percent.
● STASHED CASH: Will consumers spend on travel?
—GDP growth expected to be lower in 2022 and 2023 than 2021.
—Many households have reduced debt and increased savings.
—Consumers saved US$5.4 trillion globally to April 2021 since pandemic started.
—UK household savings £125 billion ($169.4 billion) higher than they would have been without the pandemic.
