According to a study presented on Tuesday, ticket prices will rise sharply this year. The airlines would still have no financial leeway to remedy their staffing misery. The flight cancellations that are so frequent at the moment could become the norm. In the medium term, the financial experts in European traffic also expect advantages for the more environmentally friendly railway. The airlines have already raised ticket prices significantly as a result of the sharp rise in kerosene prices (up 89 percent) since the beginning of the year, according to the study. “The airlines are trying to make up for the losses of two years of the corona pandemic,” said Milo Bogaerts, Allianz Trade boss for German-speaking countries. An average price increase of 21 percent compared to the previous year is expected for the year as a whole.
Together with the higher passenger volume, the companies’ sales should more than double compared to the previous year, which was characterized by corona, but are far from sufficient to offset the losses since 2020. Most companies are not expected to return to profitability until 2023.
In contrast to consumption-dependent kerosene costs, company personnel costs are fixed. In view of the fuel prices, the airlines currently have little incentive to increase their staff, which was severely reduced during the crisis. The consequences for Allianz Trade are obvious: “Flight cancellations are increasing and spoiling the holiday joy of travelers for a little longer.”
In the medium term, the industry will face more competition from the more environmentally friendly railways for European connections, the authors expect. While the development of CO2-neutral aircraft engines will take a long time, the heavily indebted airlines also lack the money to buy new, more economical machines in the meantime. The political requirement to increasingly mix in sustainable fuels will continue to drive up fuel costs and squeeze profit margins.
Source: Nachrichten
