War, rising costs to delay European air traffic recovery, predicts Eurocontrol

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Recovery of air traffic levels in Europe to pre-pandemic levels will take longer than expected, according to a fresh forecast from network manager Eurocontrol.  

The war in Ukraine, the resulting economic fallout and the problems the aviation industry had this summer with meeting the bounceback in travel after the pandemic are all taking their toll.  

Eurocontrol therefore expects traffic to recover to 2019 levels in 2025, not 2024, as it previously predicted.  

“We have seen strong demand this summer, but this has been held back, both by the capacity of the sector to handle the rapid growth and also by the impact of the war in Ukraine,” Eurocontrol Director General Eamonn Brennan commented in a statement on October 17, 2022. 

Eurocontrol expects to see 9.3 million flights in 2022, 49% more than in 2021, but 16% below 2019 levels. In June, before the chaotic summer season got underway, its prediction was for 9.5 million flights this year.  

Brennan added: “We are optimistic about traffic recovering to around 92% of 2019 levels next year. But there are still significant downside risks that could affect the recovery”. 

What are the factors affecting recovery? 

With Russia airspace shut off to EU carriers and Ukrainian airspace closed due to the war, airlines have been forced to reroute flights, notably to the south of the region. This has resulted in longer flight times and more fuel burn, which means higher costs for airlines.  

In its seven-year forecast, Eurocontrol said it expected restrictions on Ukrainian, Russian, Belarusian and Moldovan airspaces would remain until 2028. 

It said increased energy prices as a result of the war would affect consumers’ purchasing power and therefore spending on travel.  

Some of the staff shortages seen in summer 2022 might also happen again in 2023, Eurocontrol cautioned. On the positive side, it said full restoration of long-haul traffic flows was expected to occur in 2023.  

Major European carriers have said bookings are holding up so far, but concern remains in the market.  

What are the scenarios? 

Eurocontrol’s forecast contains three scenarios – high, baseline (the most likely) and low. Until July, the year had been tracking above its previous baseline scenario. However, capacity issues at airports, airlines and air traffic control across Europe, as well as the war in Ukraine and increasing energy prices have combined for a less optimistic outlook.  

Here’s how Eurocontrol describes the three scenarios in its latest forecast:  

  • The High scenario envisages moderate GDP growth, a limited impact on demand from inflation, good passenger confidence and limited capacity constraints in 2023 at airports and airlines. 
  • The Baseline scenario is based on GDP being weak, inflation (including jet fuel price) impacting demand and lower passenger confidence/propensity to fly. 
  • The Low scenario considers the impact of several downside risks, including a number of states in recession in 2023, strongly impacted demand for travel 
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