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OAG: GLOBAL CAPACITY HAS BOTTOMED; TIDE HAS TURNED
May 20, 2020

Air travel intelligence firm, OAG, reported that global airline scheduled seat capacity for the week commencing May 18 has returned above 30 million seats.

 

The number remains some 83 million seats below the same week last year or 73% lower but OAG noted that with two weeks of consistent growth the numbers are at last growing. 

 

"One of the positives that we will see is “record-breaking” weekly numbers. For instance, this week capacity has increased globally by some 6%; that will not I suspect have happened before. Meanwhile, USA TSA Checkpoint data reflects a 46% increase in activity in the last two weeks; 250,000 travellers were processed on the 15th May compared to 171,000 on the 1st May," it said, noting that there are positives in the latest data.

 

At a regional market level capacity in South Asia has doubled week on week with some 1.7 million additional seats added back for sale or perhaps at least scheduled to operate.

 

It said the reopening of the Indian domestic market accounts almost all of that recovery and as we have seen across other markets and specific airlines such capacity growth often leads to very high levels of cancellation in the first weeks of service.

 

Some level of growth seen

 

In total, OAG said seven of the top global regions have some level of growth over the previous week; ironically North East Asia which has been the one spot of optimism for the last few months has a slight week on week decline with Chinese domestic capacity declining slightly post the early May public holiday, but certainly nothing significant.

 

The respective pace of the COVID-19 event is also reflected in a further 22% reduction in weekly capacity in Lower South America. It said it is important to remember that every region of the world is at a different stage in the “event” and no two markets are likely to enter or recover from the event in the same way. 

 

"Domestic market capacity continues to account for over 85% of all seats operated and clearly markets such as China, the United States and the welcome return of the Indian market are major factors in such a large share," the firm said.

 

Biggest challenge

 

"The biggest challenge in the next couple of months for the whole aviation industry and particularly airlines, airports and tourism boards will be seeing how demand recovers," OAG said.

 

Next weeks capacity data is unlikely to show the same level of percentage growth as this given known lockdowns and airline schedule filings through to the end of May, the intelligence firm said. However, it noted that carriers are already announcing and loading significant capacity increases for June, especially amongst the mainline carriers in Continental Europe where travel lockdowns and quarantine requirements appear to be easing.

 

"With 213 airlines currently not filing schedules this week compared to the week of the 20th January and some 10,000 airport pairs still not being operated, there is obviously a very long journey ahead of the industry. But at least it looks like the tide has turned," OAG said.

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