Fares expected to remain high for up to 3 years

[reader]

From The Thaiger

Global aviation has taken off to a promising start this year, with the Pacific Asia Travel Association predicting a 71% growth rate for the region. The downside is that the recovering industry can’t get enough labour to keep up and the massive swell in demand has brought with it a massive swell in flight prices.

Travel restrictions have been lifted worldwide, allowing for easier and more convenient air travel. Even ultra-locked-down China has allowed travel to resume post-pandemic. But their delay in reopening left Asia lagging in recovery, as the World Tourism Organisation believes Europe and the Middle East will reach 80-95% of its pre-pandemic numbers this year.

 

There is massive pent-up demand from eager travellers, but the Covid-19 pandemic battered airlines to the ground, and getting back up has been challenging. Many went bankrupt, and layoffs were unavoidable across the whole industry. Some returned leased planes and now have to order new ones to replenish their fleet.

Two-thirds of all passenger planes were grounded and, by the middle of last year, 5,161 out of 28,674 planes in the world are still dormant, with Asia hosting the brunt of them. Estimates put 23% of all flights in Asia out of service due directly to China’s closure.

 

But things have steadily improved, and by the end of last year, global air traffic was up from 41.7% of pre-pandemic numbers in 2021 to 68.5% in 2022. Though, looking at December 2022, while flight capacity was at 77.9% of 2019 levels worldwide, they were only at 59.8% in Asia, according to the International Air Transport Association (IATA)

While there is massive demand to travel, a significant backlash has formed as flight prices have climbed to what many consider an unreasonable level. The overwhelming jump in demand was similar to that of cargo services during Covid when people were locked down, and prices soared.

Add to that the huge spike in jet fuel prices, which rose by nearly 80% in 2022, and the costs of getting flight services reestablished, and you have a recipe for painfully high ticket prices.

Experts believe prices will stay high until more planes can get up and running and the demand is no longer outpacing the available flights and seats. The additional cost of staffing to fill the shortage and fluctuating jet fuel prices may further hinder price easing. Some in the industry are predicting the price surge to last for two or even three years coming out of the pandemic.

The only good news is that domestic flights have recovered more quickly and prices for flights within Thailand have recovered significantly. Meanwhile, Thai AirAsia says their international flight rates will be up 20% and average flight prices to China are up 50% all around.

Flights from Europe are expected to remain above 40,000 baht, and flights from Japan are between 26,000 and 35,000.

 

[vinapu]

ok, we will gnash our teeth but still come to LOS 

[PeterRS]

Fares from the LOS have also risen dramatically. Economy fares from Bangkok to Hong Kong have risen more than 50% in three months despite many more flights now. Biz fares on Emirates from BKK to HKG which used to be 14,000 baht for at least 3 years pre covid are now 26,000.

[tm_nyc]

Sad to say but the current situation is a win-win for the airlines.  They are flying fewer flights but are racking up record profits.  Meanwhile, their customers are getting screwed.  Hard to say when (or even if) things will return to a pre-Covid normal.  Will that stop me from booking another flight to BKK?  Absolutely not!

[PeterRS]

On 3/30/2023 at 9:59 AM, tm_nyc said:

Sad to say but the current situation is a win-win for the airlines.  They are flying fewer flights but are racking up record profits.  Meanwhile, their customers are getting screwed.

I undersand your view and am as pissed off as others. But I think the comment is hardly accurate given the massive losses airlines have suffered over the last three covid years. Somehow they have got to try and recover these and have little option but put fares up. We just have to find the best deals we can.

[tm_nyc]

What I had in mind was the US carriers which received billions in Covid relief funds from the US government & still have been charging very high fares.  I just don't know about airlines in other countries.  I think that some received help from their governments but probably not all.  So, point taken! 

[reader]

From The Nation

The Transport Ministry is pointing to the stronger-than-expected recovery in tourism for the high cost of flights, saying the surging number of international and domestic tourists created a large gap between supply and demand.

Thailand has attracted an average of 140,000 visitors a day since its reopened its borders in November 2021, Acting Transport Minister Atirat Ratanasate said on Thursday.

They have been joined on flights all over the country by a surge in domestic tourists since the pandemic eased, Atirat said.

This surge demand occurred as the aviation industry recovered from the Covid-19 crisis, making it incapable of meeting the demand, which resulted in higher prices for flight tickets, the minister explained.

Complaints from passengers have prompted Prime Minister Prayut Chan-o-cha to order the Transport Ministry to address the issue of expensive air tickets.

In a “seller’s market” it is normal for the price of air tickets to be higher than normal, Atirat said, advising travelers to reserve flight tickets in advance and avoid buying them at the last minute.

Citing a report from the Civil Aviation Authority of Thailand (CAAT), the minister said that 82.5% of air tickets from Bangkok to Phuket are priced below 2,500 baht each, even those during public holidays or bought shortly before flights.

The ministry and relevant state agencies, including the CAAT, have taken action to keep air ticket prices at “more reasonable levels”, Atirat said. These include allowing airlines to import more planes and improving ground services at Suvarnabhumi International Airport.

The CAAT has identified five factors that caused air-ticket prices to rise:
- Suvarnabhumi’s insufficient ground-handling services, which are now only at 50% of demand,
- inefficient slot allocation,
- not enough flights to meet demand,
- insufficient plane-maintenance services, and
- the limited number of flights to some destinations.

[PeterRS]

I have just paid 75% more for economy flights to/from Hong Kong at the end of the month than I did in December for flights on the same airline in mid-January. I could not even get my preferred dates as there were only premium tickets left for many afternoon/evening returns. The new normal it seems.

[Latbear4blk]

10 hours ago, PeterRS said:

I have just paid 75% more for economy flights to/from Hong Kong at the end of the month than I did in December for flights on the same airline in mid-January. I could not even get my preferred dates as there were only premium tickets left for many afternoon/evening returns. The new normal it seems.

Oh wow. I noticed the increase in prices between US and South America, but not a 75% higher!

[floridarob]

9 hours ago, Latbear4blk said:

Oh wow. I noticed the increase in prices between US and South America, but not a 75% higher!

from Mexico to USA are double, soo a 100% increase 

[traveller123]

Pre Covid flying from BKK to Manchester economy return 600 GBP was expensive, I'm flying on Emirates later this month and it cost me 1250 GBP (approx 150 GBP is because I want to try upper deck economy)

[reader]

Deleted duplicate post

[vinapu]

20 hours ago, floridarob said:

from Mexico to USA are double, soo a 100% increase 

enjoy while it lasts