Welcome to the USA: 20-month border ban finally lifts

A number of airlines, including some of Europe’s flag-carriers, hope this will help kick-start long-haul operations that are so dependent on the North Atlantic market but have been largely grounded for 20 months.

US borders have been effectively closed to most foreigners since then-President Donald Trump imposed a travel ban in March 2020 to stem the spread of Covid-19. As so often when restrictions are lifted overnight, the industry can expect a surge in pent-up travel demand as consumers book long-overdue family visits or trips to Florida, and relieved executives can switch off their Zoom and resume face-to-face contacts.
Over in Europe, low-cost carriers continue to report healthy summer revenues and lay out fleet and route expansion plans for the next holiday season. They include Hungary-based Wizz Air, which said capacity this August almost matched its 2019 figure for the same month. However, like Ryanair last week, Wizz warned of losses going into the winter – more evidence that, despite optimism about 2022, budget airlines face a difficult next few months as demand dries up and cash gets tight.

The third week of November sees the start of the Dubai air show, the first of the traditional big-four industry gatherings to take place since Singapore in February 2020. While Covid protocols will make the event seem very different to previous Dubai shows, organisers are expecting a large turnout of exhibitors and visitors, many of them keen once again to interact on a personal level with colleagues, customers and suppliers.
However, it seems unlikely that the show will see the sort of big-spending bonanza of some previous Dubai events, when the likes of Emirates, Etihad, flydubai and Qatar Airways signed multi-billion dollar commitments for hundreds of aircraft, including for Boeing’s latest 777X flagship. While the US manufacturer will be exhibiting its large twinjet at Dubai for the first time, orders for it, or any other type, could be in short supply.

While the Gulf market – much of it driven by connecting passengers through hub airports – is recovering fast, its carriers were floored by the global travel slowdown. In addition, Etihad’s one-time expansion strategy of teaming with airlines in Europe and India has flopped, and the Abu Dhabi airline was going through retrenchment pre-crisis. The atmosphere at Dubai is likely to upbeat about the immediate future, but tempered with a good doze of caution about the longer term.

One part of the market in the Middle East where there is plenty of optimism did not even exist a year ago. The landmark Abraham Accords between Israel and the United Arab Emirates and Bahrain opened air routes between these countries for the first time. Emirates will begin flying daily from Dubai to Tel Aviv from early December using a 777-300ER. The connection is the latest of several this year to link Ben Gurion airport to the Gulf, with El Al, Etihad and flydubai all launching services.

Airlines offering cargo flights were one of the beneficiaries of the pandemic. As e-commerce continued to grow, but belly-hold capacity on passenger aircraft dwindled, there was a rush to convert airliners to ‘preighters’ by removing seats. Operators with dedicated cargo aircraft had more work than they could cope with, and specialist firms were busy converting older passenger aircraft to flying trucks.

Some believe the boom is coming to an end as belly capacity returns to the market. Not all agree. Lufthansa chief executive Carsten Spohr says he expects demand to remain strong after announcing quarterly results that show air freight was the stand-out performer for the German carrier. That could be down to a fundamental change in the way the global economy works, with fast-moving trends driving demand for Asia-produced goods that customers want in their hands within days.

Finally, with COP-26 in Glasgow including calls for the industry to speed its transition to a sustainable future, developments in electric-powered aviation continue apace. This week, US company Wright Electric said it is working on a “zero-emission” version of the British Aerospace 146 regional jet, able to carry 100 passengers for 1h. Wright hopes to begin testing the technology in flight from 2023, and have the aircraft – its four Lycoming turbofans replaced with electrical systems – in service by 2026.