Hardly any other industry has been hit as hard by the Corona crisis as that of the airlines. Travel restrictions and uncertainty resulted in empty planes. But how will this affect future ticket prices?
Airlines hit hard by corona crisis
The corona pandemic has hit the global economy hard, but hardly any other industry has been as significantly affected by the virus as the travel industry and especially the airlines.
During the lockdown, most aircraft remained on the ground, air travel was canceled and passengers claimed their money back. This resulted in severe losses for the respective airlines.
Since the summer vacation travelers have been traveling by air again, but many business trips are still canceled. Ultimately, this means that the airlines send relatively empty or only a few aircraft into the air, which has a negative effect on the profitability of the flights.
But what impact does this have on airfares for consumers?
Experts predict falling airfares
Many consumers feared that flight prices would skyrocket, especially after the corona pandemic or after any relaxation of travel restrictions. While various voices spoke of dramatic price increases, which should resemble the ticket prices of the 1950s, experts see the opposite, at least in the short term.
In an interview with CNBC, Kent Gourdin, professor of logistics and transportation at the College of Charleston, explains that he doesn’t think airfares will rise anytime soon. He explains: “Airlines are simply trying to fill their seats.” Accordingly, price increases, at least until the virus no longer poses a threat, are unlikely.
Dean Headley, a professor at Wichita State University, also doesn’t see any higher airfares in the near future, according to CNBC. “It would be difficult for the airlines to raise prices for the autumn trips while keeping the few passengers who have to fly as customers. Price continues to be an important factor when people decide to fly,” said Headley.
In the long term, prices could rise
As a result of the corona pandemic, flight prices will initially most likely decline. The umbrella association of airlines (IATA) sees flight prices falling in the short term, as Spiegel reports. Because demand fell sharply during the pandemic. In order to stimulate this again, the consumer must be lured with lower prices, said Brian Pearce on behalf of the IATA. According to the expert’s forecast, flight prices will not increase until at least the coming year.
In the long term, however, airfares could rise, especially if the aircraft have to fly with low capacity due to possible hygiene regulations. So if seats have to be left vacant, that will likely have an impact on price. Henry Ely / finanzen.net editors