The industry has recalibrated to see 2020 as baseline for incremental growth, says Decius Valmorbida
Amadeus search data shows the world is catching up with US recovery
The rest of the world is catching up with the rebound in demand for air travel seen in the US, according to the latest data from Amadeus.
The Europe-based GDS and travel technology giant released air search data up to the end of October this week to shed light on the travel recovery.
October saw search volume improve although globally it remained 28% down and for international travel alone was 22% down on the last week of October 2019.
The Western Europe, Middle East and Africa (WEMA) region saw the best performance in October, ending the month just 7% down compared to 14% down in the US, central and southern Europe 22% down and Asia Pacific 71%.
“The world is catching up,” said Decius Valmorbida, president of Amadeus’ travel unit. “Before, we had the US doing well and the rest of the world pretty depressed but what we are seeing it the rest of the world catching up.”
Valmorbida said search data throughout the pandemic search data has been a good indicator of future market trends.
“Search data is a very good indicator because it shows intent. New York, London, Moscow and Dubai are the most searched inbound and outbound. In our assumption these are the winners.”
The top five WEMA routes are all international and three depart from London and three arrive in New York and the city is the starting point for the top five Americas routes.
Some routes are back above pre-pandemic 2019 levels while Moscow is in all top five central and southern Europe routes of which four are domestic.
Valmorbida said it looks like that while travel in Asia was the first into the pandemic it will be the last out because of a stricter approach to keeping COVID infection rates low.
But he said it is not a case of if Asia will recover, but when. “Frontiers needs to be open,” said Valmorbida.
Amadeus also released data from its Demand 360 business intelligence division for the hotel and hospitality sector.
It showed UK average room rates have risen 125% during 2021 from a low of £59 per night in January to £133 in October.
And UK occupancy rates have increased from lows of 16% in January to 68% in September. In June, July, August, September and October occupancy levels were above 45%.
The data also reveals that booking lead-in times have recover with a third of reservations being made 31 days in advance of the day of travel. That figure was 31% in 2019.
The largest proportion of hotel reservations are still made within seven days of departure (39% in 2021 versus 38% in 2019) but this factor has improved from the 66% in 2020 making forecasting more easy.
Bookings for the festive period are back to 2019 levels and Amadeus says have the potential to rise further given the zero to seven day booking window.
Valmorbida said: “The reality is the industry can be working in one of two gears.
“Either you are ramping up and bringing in more people and expanding routes thinking things are going to be better or the other mode is to say the future is going to complicated and it’s time to tighten our belts and reduce our capacity.
“No one knows when all of these doubts are going to be dispelled. But what we can see is, based on the data, that next summer is going to be better, 2022 is going to be better than 2021.
“You can make a lot of comparisons with 2019 but those are a bit irrelevant now. Everyone has adjusted to what was the difference to 2020. A recalibration has happened.
“What’s important is every year is going to be better and there’s going to be growth and there’s going to be incremental volume on the readjustment in 2020. From an economic perspective everything is going to be upside.
“2019 was the golden year. Asking when are we going to be back to 2019, that’s not going to help anyone.”
Valmorbida said the pandemic has prompted airlines to review their fleets and to retire older less efficient aircraft and to refocus their strategies.
And it made historic comparisons with traffic not relevant with the countries that have experiences the best recovery determined by which governments managed the health crisis better.
“We see a lot more information seeking. There’s a lot more need for information and what is available, what the restrictions are, is it worth going to that place. There’s a lot more time dedicated to deciding which destinations to go to.
“The world top ranking are changing, now we have movement. There’s plenty of opportunity in this rebuild of travel.”