The Economist: What is the next destination for commercial aviation?

Work and shopping, for better or worse, have been permanently altered by the pandemic. The airline industry is hoping its own disruption due to COVID-19 will prove temporary. Fortunately for those without vacations, visits to family and friends, or even a business trip, flying in 2022 will look a little more like the pre-pandemic era of airplanes, with differences between domestic and international routes, of short and long distance and east and west.

The numbers taking to the skies have risen steadily since March 2020, when the pandemic first brought flights to a halt. Most forecasters expect as many passengers to fly by 2024 as in 2019.

IATA, a trade body, estimates that 3.4 billion people will buckle up in 2022. That’s nearly double the number in 2020, though still down slightly from 2019, when 4.5 billion took to the skies.

However, uncertainties remain, especially the pandemic. Consider the omicron variant. Ed Bastian, head of US Delta Air Lines, described shipping in recent weeks as “hellish” after some 8,000 employees, about 10% of his total workforce, contracted the virus.

Crew shortages, tighter travel restrictions and bad weather conspired to force the cancellation of 60,000 flights worldwide between December 24 and January 3, Cirium, an aviation data firm, calculates. That corresponds to about one in 40 flights. The fact that the worst Christmas period in a decade still made December the busiest month of 2021 illustrates how far the industry has to go.

The unpredictable course of COVID-19 shows that even bright spots can get cloudy. Large domestic markets, unaffected by international travel bans and other uncoordinated border restrictions on vaccines and testing, have led the recovery.

Within the United States, the world’s largest domestic market, demand for seats has exceeded 80% of pre-COVID levels. In China, it has surpassed pre-COVID times at times over the past year, thanks in part to the country’s strict “COVID-zero” strategy.

Although lockdowns to quell recent outbreaks in the run-up to the Winter Olympics in Beijing in February have put the wedges back in, China’s aviation regulator still expects domestic traffic to be around 85% of previous levels. to the pandemic in 2022.

Plans to restore capacity among the world’s airlines give a glimpse of the likely shape of improvement on international routes, which IATA predicts will reach just 44% of pre-crisis demand this year.

Some low-cost airlines serving short-haul connections in the United States and Europe, where travel restrictions are soon to be relaxed, could exceed pre-COVID capacity, another aviation research firm IBA believes. The Big Three U.S. network carriers will also benefit from the reopening of the lucrative transatlantic market, which is expected to return this year to where it was in 2019. Delta will approach pre-COVID capacity in 2022, and United may get over it. Some of Europe’s legacy airlines may also benefit. IAG, which owns British Airways, is expected to reinstate all its flights across the Atlantic by the summer of 2022.

Airlines in the Asia-Pacific region are likely to remain stagnant. Many governments, relying on isolation to control the virus, have tightened already strict travel rules to contain omicron. Capacity is still around 60% below previous highs. Singapore Airlines will operate at half its pre-COVID capacity for at least the first few months of 2022; Australia’s Qantas may operate at just 45% this year.

Even if omicron were the latest on COVID, airlines have other things weighing them down. As Andrew Charlton of Aviation Advocacy, a consultancy, points out, governments have showered beleaguered airlines with cash to keep them in the air. Much of that, about $110 billion, IATA says, must be returned. And that is added to the new debts contracted with the creditors of the private sector.

Also, as long as demand remains weak, airlines will find it difficult to pass on rising fuel costs to passengers. The industry’s net losses will shrink from a staggering $138 billion in 2020 and $52 billion in 2021. Collectively, airlines are expected to lose another $12 billion this year. Better, but hardly stellar.