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Global air travel recovery will remain weak near-term, says analyst

Global air travel recovery will remain weak near-term, says analyst

International air travel will likely remain sluggish in the near term as uncertainties over the omicron Covid variant linger, according to an aviation analyst.

Brendan Sobie, independent analyst at Sobie Aviation, said omicron has hit passenger confidence in “travel right now because things are changing every day.”

“The recovery we were hoping we were going to have continuing into the first half of next year, its just not going to happen. That’s going to be a setback,” Sobie told CNBC’s “Squawk Box Asia” on Thursday. “Because we don’t know too much about this variant and we don’t know what’s around the corner.”

While much remains unknown about omicron, the World Health Organization warned that the variant is spreading “significantly faster” than the delta strain and could change the course of the pandemic.

The highly infectious variant has now been detected in at least 89 countries and forced some governments to impose stricter containment measures during the holiday season.

Singapore freezes new quarantine-free ticket sales

On Wednesday, Singapore said it would freeze new ticket sales for quarantine-free travel in an effort to limit the number of imported omicron cases.

Singapore’s vaccinated travel lane program was key in the country’s pivot to a “living with Covid” strategy and the latest move deals a significant blow to that effort. Shares of Singapore’s travel stocks such as Singapore Airlines fell Wednesday following the announcement.

“Singapore Airlines is going to be impacted by the setback on the VTLs,” noted Sobie, adding the move will further reduce its load factor, or the percent of seats filled.

He added things are not moving in the right direction for Asia-Pacific airlines, which is “very disappointing.”

“It’s been such a difficult year for Asia-Pacific carriers — much worse than expected,” Sobie noted.

“Things looked like they were starting to get better. Now, unfortunately, its just going in the opposite direction.”

By : ILIAS ELABDI Date : December 24, 2021 Category : Travel News & Insights Comments :

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