Airlines cling to hopes of summer bounce even as bookings wane

The global airline industry’s top lobbyist expressed cautious optimism that travel will bounce back in the second half of 2021, despite a dismal start to the year.

While forward reservations for summer are stuck at 32% of 2019 levels in North America, and half of that in Europe and Asia, accelerating vaccine campaigns and an improved health-care picture mean demand can still pick up, Willie Walsh, director general of the International Air Transport Association, said in his first address in the role.

“We should remain optimistic that the second half of this year will be more positive than we’ve seen so far,” said Walsh, the former chief of British Airways owner IAG SA. “The expectation of the vaccine roll-out accelerating is one of the reasons why we can be optimistic that things will start to improve.”

Forward bookings for the May-to-September time frame are at just 15% of 2019 levels for Europe and 14% for Asia, with North American demand looking slightly healthier, according to figures released Wednesday by IATA.

The usual surge in bookings for summer has given way to caution, as passengers wait for clarity on vaccinations and travel restrictions. Ryanair Holdings Plc, Europe’s biggest discount airline and a staple for vacationers, warned Wednesday that it would struggle to make a profit this year as setbacks fighting the virus delayed a rebound in travel.

Walsh said that international traffic was down almost 89% in February and is showing no signs of recovery in the current environment. But he added that when government restrictions are relaxed or removed there is strong pent-up demand.

He also saw reason to be positive on the prospect of a travel corridor between the U.K. and the U.S. “in the near future.” Such a plan has been increasingly touted as a way to reopen travel between two economies which are progressing well with vaccination campaigns, even as continental Europe struggles with a fresh wave of the virus.