2023-06-10 08:20:49
And this, although kerosene prices have experienced a lull, after the peak reached in the wake of the invasion of Ukraine by Russia in early 2022. The International Air Transport Association (Iata) estimates that they will go down to $98.5 a barrel this year, from $135.6 last year.
Representing between 25 and 30% of airline costs, fuel normally has a significant effect on ticket prices, both upwards and downwards. However, the decline is long overdue.
Beyond fuel, “labour costs, other supply chain costs (…) are higher or are increasing,” observed at the start of the week in Istanbul Marie Owens Thomsen, chief economist of Iata.
“Companies need to find a way to cover these costs or they will start losing money again”, when they are barely back in the green and have to repay the colossal debts contracted during the Covid-19, a- she added during the general assembly of her association which federates 300 air carriers from all over the world.
— Shortages and inflation –
The main subject, for Vik Krishnan, specialist in the air sector at the consulting firm McKinsey, is now “less in the price of oil than in the fact that there are not enough plane seats available. , and too many people who want to sit there”.
Despite their sometimes full order books until the end of the decade, aircraft manufacturers are struggling to meet their delivery targets due to shortages of parts or materials from their suppliers.
In addition, there is the subject of “labour costs, many companies have had to renegotiate their salary agreements with their pilots and cabin crew upwards”, observes Geoffrey Weston, consultant at the consulting firm Bain & Company. . This is also the case for ground operations companies which “had to pay much higher salaries when leaving the Covid” to baggage handlers or mechanics, according to him.
“There are not many factors that will lower ticket prices,” summarizes Pascal Fabre, specialist in the air sector at AlixPartners.
These fares do not appear to have dented travel demand so far. “With my counterparts, we all have the same impression, it remains very strong, despite the macroeconomic winds” contrary, says Carlos Muñoz, CEO of the Spanish low cost company Volotea.
And while the aviation sector will have to invest hundreds, even trillions of dollars to hope to achieve its decarbonization objective by 2050, between new planes and renewable fuels, Marie Owens Thomsen, from Iata, does not see no respite for consumers.
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