Air fares have begun to rise again in China offering an insight into how the world’s travel industry might soon rebound.
Widely watched airfares in China are recovering to pre-pandemic levels as domestic tourists lead a patchy air travel recovery, scattering crumbs of hope to a shattered global travel sector.
With international markets like Europe still in partial lockdown, the global tourism industry’s attention is riveted on China’s new travel patterns as it brings Covid-19 under control and lifts curbs on movement.
The Chinese domestic market quietly overtook the once-dominant US market in size during the pandemic, but multiple coronavirus outbreaks before last month’s Lunar New Year halted the rebound and could lead to first-quarter losses.
Now, with temporary testing and quarantine restrictions once again lifted, average prices for an economy seat during the April 3-5 Qingming festival, or tomb-sweeping holiday, have rebounded to 96% of 2019 levels, according to data from Ctrip.
Economy-class airfares for trips over the Labour Day holiday in early May have risen 11 per cent compared with 2019 levels, says Ctrip, run by online travel giant Trip.com Group Ltd.
“It seems like demand has really caught up with capacity once again and airlines are deciding discounts are no longer needed to stimulate demand,” said Luya You, transportation analyst at BOCOM International in Hong Kong. “I think the pent-up demand that everyone has been expecting is finally showing up in full force,” said You, adding she expects yields and revenues to reach normal by the second half.
A similar pattern has been spotted in the US, too, where average round-trip domestic fares for May to August are up 36 per cent on last year, though still 20 per cent the 2019 level.