Routes & Revenue: The Path To Profitability

OAG's most recent aviation webinar focused on the profitability of airlines and selected routes. As always, the panel looked at the latest global capacity data, considered how world events may affect capacity and routes, and deep-dived into the world of revenue and ancillaries with our travel and aviation industry guests.

Highlights from the Morning Webinar

Paulos Ashebir Lakew, the Head of Industry Analysis at IATA, Sustainability & Economics, joined John Grant and Deirdre Fulton for the first webinar of the day. Below are just a couple of highlights from their analysis.

The panel started with a look at global capacity, which is currently tracking just 1.6% below 2019 in October. They focused in on China, where there is strong growth in the domestic airline market but international capacity remains behind, -57% for the full year in 2023.

As conversation moved to profitability, John, Deirdre and Paulos looked at the biggest routes by revenue in January-June 2023 vs January-June 2019, as detailed in the slide below. 

Biggest Routes by RevenueJohn was keen to point out that while revenues are certainly up, we must bear in mind that costs have also increased in the past four years.

Interestingly, six of the biggest revenue-making routes are domestic, while the route that has seen the biggest increase in revenue in this time frame (416%) is an international one, Dubai - Riyadh, which is shorter than many others on the list but a busy route for business traffic.

Watch the Morning Webinar


Highlights from the Afternoon Webinar

Hopper's Lead Economist, Hayley Berg was on the panel in the afternoon as the team pondered whether travel is now considered an essential item rather than a luxury, as we move past "revenge spending". Hayley explained that Hopper is seeing generational differences as Millenials and Gen Z delay some milestones and prioritize spending on travel.

Looking at Hopper's most searched routes, Deirdre noted that Florida's popularity has not diminished, and Hayley confirmed that the state has emerged from the Covid-19 pandemic in a strong position, with its warm weather, leisure attractions, cruise connections, and conference space.

Ancillaries were also on the agenda, as our hosts and panel considered the un-bundling of air fares. While this includes things like choosing a specific seat, checked baggage and meals, there is also an appetite for products that guarantee free cancellation or compensation for delayed or cancelled flights.

Watch the Afternoon Webinar


If you'd like to get involved with our aviation industry webinars, enter your email below and we'll invite you to attend.

Our next webinar is on Wednesday 6th December.

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