Which airlines will emerge the strongest in 2022

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  • cwoodward
    Participant

    With air travel starting to be again a realistic prospect it is perhaps interesting to plot which of the worlds hard hit airlines will recover the strongest and fastest in the coming months.
    In Asia Pacific I suspect that is likely to be Singapore and the Cathay group.
    I know rather more about Cathay than I do about Singapore and below are is my reasoning as to why Cathay will continue to be a strong force in the coming years very possibly at the expense of several of its weaker less well run competitors in the region.

    Although one of the airlines hardest hit by Covid 19 due to the lack of any domestic market Cathay appears to be in surprisingly robust shape with reported cash reserves of B38 HKD with a 2021 net cash burn of less than 1B a month and reducing. Over 3000 pilots and some 13000 cabin crew still employed and plans to boost scheduled passenger flights from the current 7-8% to 30% at the end of September. The large relatively new fleet also looks looks in good shape with few leased aircraft and several older of these leased aircraft not being renewed as leases expire. New aircraft still being delivered with several new Airbus aircraft being (A321 A350) delivered so far in 2021 for both Cathay and the Hong Kong Express subsidiary -the last being an A350-1041 to CX delivered in May. Additional freighters to the Air Hong Kong subsidiary have also been added and it is reported that also some older Cathay A330s have been converted (possibly temporarily) to freighters. In all CX looks fairly well set for 2022.

    Which of the European, North American, Middle Eastern and Australasian majors will emerge stronger for 2022 and what would drive this strong recovery is interesting to contemplate.
    Also perhaps interesting is what will be the emerging situation with African airlines particularly SAAs future is interesting to contemplate. Can they recover to their former glory to once again dominate once again the sky’s of southern Africa eith also a stong international network ?


    esselle
    Participant

    [postquote quote=1104293]

    I think this is a good analysis of CX’s position.

    For me, QR and EK will be the ones to watch. Both well funded and with plenty of metal to put back into use. QR, in particular, are very experienced at new route development (based in no small measure by the work they did during the blockade), and, coupled with the major expansion of HIA, they will be hungry for growth.

    It will also be interesting to see how a “new” BA might emerge under Doyle who will, I believe, be sending the “quality” message out to the market.

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    canucklad
    Participant

    Interesting topic Cwoodward

    I’d normally agree with your CX analysis, sadly as a HK based airline and thus relatively speaking has a western outlook I fear it’ll( if not already) become a thorn in the side of the increasingly paranoia state of the ruling party in Beijing.
    My question would be, will their interference, both directly and indirectly sabotage their recovery.? After all, a strong independent is a metaphor for the city itself ?

    In Europe, the answer is much easier, … Ryanair , simply because of the scale of operation and the vent up need within the continents population to get moving about again.
    Air France/KLM group will also do well primarily down to the political need in Paris to see their national carrier succeed . When you add in KLM’s more relevant contribution of the Schiphol hub then KLM should alone be well placed to start transiting people on masse sooner rather than later.

    No idea about North America, but I’m predicting a very turbulent time for AC .

    I agree with esselle, I think the global winner will be QR . I suspect they’ll be back over my airspace in West Lothian (EDI) much quicker than EK

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    Inquisitive
    Participant

    Although there are good chance of recovery for CX and SQ in the next year, but the winners next yet will be the US airlines like United, American and Delta. Plus the Chinese and Indian airlines; mainly from domestic passengers.

    The international passenger traffic – especially the business passengers – will not be sufficient in 2022 to have recovery for European and East Asian airlines.

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    MarcusGB
    Participant

    We should differ perhaps Airlines within Europe, and World Airlines?

    I agree that KLM, will recover well, as really their domestic market is Europe itself. Much of their Business is transferring many through Schiphol, for onward flights to other places within Europe, not just Other Continents. Air France (same Group), has a loyal following within France, not so much as KLM within Europe.
    KLM have many new “Holiday routes” along the lines of the green countries opening up.

    Either way, Many countries are classifying us as an area of concern now with our infection rates increasing, so are not allowing us to travel to them, not transit, for eg KLM via Amsterdam, and transiting onwards. Certainly The NL’s are doing well, and should be classified by us as Green, but i doubt they would classify us as the same.
    Transatlantic traffic will be a key for all Airlines, especially KLM/AF, with the other SkyTeam Airlines out of AMS.

    Perhaps the days of us transiting easily at another European Hub with our chosen Airlines, are now too complicated, taking in 3 countries regulations, and won’t be choices we made as before?

    I do not think in Europe, many of the low cost Airlines will recover so well, losing most of the summer period, and needing to “Pack them in” to make a profit.
    I agree that Singapore Airlines are ready to go, and hot on destinations opening up, such as Thailand Phuket, with flights ready to go from European Cities.
    Direct flights are allowed into HKT as of 1st July, and many Airlines such as KLM, SQ, TG are planning flights direct.

    Interestingly i have been given a good insight into Australia and Qantas, having lived and worked there, returning (Normally) a couple of times a year, and from friends and colleagues.
    Some other Air travel on line sites like Business Traveller Asia, Inside Flyer, Executive Traveller etc, have had a sharp eye on Australia.

    Qantas have had subsidised travel from the Government, to generate travel within this huge, beautiful Country.
    “Staycations” have replaced many travels for the Australians with such a vast array of types of destinations. Many smaller towns around the States, have had higher seats or new flights arrive, both around the coast, to Bush or outback destinations.
    Virgin Australia went Bankrupt, and are trying to emerge new but with a much lesser fleet, along with REX, a smaller operator.
    Qantas were running last week at 3/4’s of travel pre-covid, where even Domestic flights can be up to 5 hrs (Perth-Sydney), and others would be too many hours driving, or unreachable by road. Qantas are using larger Aircraft like 789’s and A330’s for some domestic routes, which give an International standard and classes of travel, which are appealing to many Australians.

    Rail only revolves around the major cities, and limited through the States, except for some Epic trains such as TransPacific, and The Ghan.
    So, with a travel bubble with New Zealand on and off, Qantas i feel will emerge very well, given their huge domestic Market.

    Sadly however, the Indian Variant has emerged and many states have local lockdowns, and Borders between states as NSW-Victoria closed to certain residents.
    It remains to be seen, if this spread continues, and impairs the domestic Air travel, and Tourism around the whole country, and with NZ.

    Either way, Premium fares Ex UK / EU to Intercontinental have become very expensive, with many fares to Asia up 30% Pre-Covid for eg.
    But we must sort out Transit arrangements at the Hubs of Airlines who are to be successful, especially in Europe and Asia.
    This would be key, if a Hub is ready to process travellers efficiently, with investment in technology and people, or Red and Green zones set up.

    We also still need that Standardisation of digital and Paper vaccination records, combined with eligible tests with a real unified Worldwide accepted format, as in an IATA Travel Passport, rather than localised or regional, unrecognised outside there! It is not impossible…


    cwoodward
    Participant

    [postquote quote=1104697]

    canucklad -It would be foolish to totally disagree that there is some political risk to CX but I would assess this to b both slight and unlikely.

    For the past many years Beijing has operated a strong and solid line between the political and the commercial. Given the huge benefits to the mainland of Hong Kong continuing to be the commercial golden goose that it continues to be any commercially damaging interference to CX is in my opinion very unlikely.
    Please lets not turn what could be an informative commercial airline topic into a political discussion though.

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    canucklad
    Participant

    [quote quote=1104774]Please lets not turn what could be an informative commercial airline topic into a political discussion though[/quote]

    Agreed, although sometimes in our new Covid world it’s hard not to do 🙂

    Oddly a good gauge of how the airline industry recovers will be the rate that the sky above me starts to fill with airlines no longer filling them and the frequency of other flights that are now minimal. … Look up at the planes on final approach and all I currently see are Ryanair, Easyjet, BA , Loganair with the occasional KLM & Finnair planes chucked in . Probably missed a few other airlines but still the skies above are empty compared to 18 months ago
    And can’t recall the last time i saw a queue of planes lining up to land

    So, without getting too political , all our leaders need to realise whats good for the goose is also good for the gander , otherwise economic growth and tourism related jobs are going to be knackered for the foreseeable future

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