Iata and Tourism Economics released a long-term view for post-COVID-19 passenger demand recovery this week, which shows that people remain eager to travel in the short and long-term.

Forecast highlights include:

• In 2021 global passenger numbers are expected to recover to 52% of pre-COVID-19 levels (2019).
• In 2022 global passenger numbers are expected to recover to 88% of pre-COVID-19 levels.
• In 2023 global passenger numbers are expected to surpass pre-COVID-19 levels (105%).
• By 2030 global passenger numbers are expected to have grown to 5.6 billion. That would be 7% below the pre-COVID-19 forecast and an estimated loss of 2-3 years of growth due to COVID-19.
• Beyond 2030 air travel is expected to slow, due to weaker demographics and a baseline assumption of limited market liberalisation, giving average annual growth between 2019 and 2039 of 3.2%. Iata’s pre-COVID-19 growth forecast for this period was 3.8%.

The recovery in passenger numbers is slightly stronger than the recovery in demand measured in revenue passenger kilometres (RPKs), which is expected to grow by an annual average of 3% between 2019 and 2039. This is owing to the expected strength of domestic markets like China which have large passenger numbers and shorter distances.

“I am always optimistic about aviation. We are in the deepest and gravest crisis in our history. But the rapidly growing vaccinated population and advancements in testing will return the freedom to fly in the months ahead. And when that happens, people are going to want to travel. The immediate challenge is to reopen borders, eliminate quarantine measures and digitally manage vaccination/testing certificates,” said Iata Director General, Willie Walsh.

“At the same time, we must assure the world that aviation’s long-term growth prospects are supported with an unwavering commitment to sustainability. Both challenges require governments and industry to work in partnership. Aviation is ready. But I don’t see governments moving fast enough.”

Short term: restart

The damage of the COVID-19 crisis will be felt for years to come, but all indications are that people have retained their need and desire to travel:

• Any possibility for borders to reopen is met with an instant surge in bookings. The most recent example is the 100-percentage point spike in bookings from the UK to Portugal when the UK’s ‘green list’ was announced in early May.
• The economy is strong and can fuel growth in travel. February 2021 industrial production levels stood at 2% above February 2019 levels.
• Consumers have accumulated savings in the lockdowns, in some cases that savings exceeds 10% of a country’s GDP.
• Vaccination rates in developed countries (with the notable exception of Japan) should exceed 50% of the population by the third quarter of 2021.

“This should be a clarion call to governments to get ready. The travel and tourism sector is a major contributor to GDP. People’s livelihoods are at stake. To avoid greater long-term economic and social damage, restart must not be delayed,” said Walsh.

He said governments could facilitate a safe restart with policies that enabled restriction-free travel for vaccinated people, and testing alternatives for those unable to be vaccinated.

“Governments must also be ready with processes to digitally manage the vaccine or test certificates, ensuring that a safe restart is also efficient.”

Sustainability

He added that aviation would grow because people wanted and needed to travel. “But we must be able to fulfil that consumer demand sustainably. Those are the ground rules for any business. It is no secret that this is more challenging for aviation than sectors with broader energy alternatives. But with the support of governments we will get there through a combination of means,” said Walsh.