During the first day of the Routes Americas 2021 event, taking place in Orlando this week, Peter Cerdá, Regional Vice President The Americas, International Air Transport Association (IATA), and Matthew Cornelius, Executive Vice President, Airports Council International-North America (ACI-NA), set the scene for the two-day conference by outlining the state of the air transport industry in the Americas and sharing their views on the path to recovery.
State of the airline industry
While the domestic market in the United States continues to recover strongly, the situation in Canada and across Latin America and the Caribbean is less positive, said Cerdá. “Domestically in the US things are looking up. But the landscape is very different around the world. Places like Mexico, the US and Columbia have removed quarantine and many of the stringent COVID-19 restrictions, and you can see that a recovery similar to 2019 levels is occurring much quicker than in places like Canada, which has been closed for over a year now.” Global markets such as Asia-Pacific, China, India and Europe also remain largely under lockdown measures, which is having further impact on the recovery rates in the US.
Cerdá, however, expressed his optimism that travel will return, as there is a strong consumer demand. “Our forecast is showing that international travel should recover by 2024, while domestic is expected to recover between 2022 and 2023. But in markets like Mexico, the domestic market is already exceeding 2019 figures.”
He also stressed that the recovery depends largely on governments relaxing the current measures and providing more liberties to people who are vaccinated, while giving options to those who are not.
“A lot of it is going to depend on governments,” he says. “Government policy has not been at its best. That is hurting us as an industry. It’s so important to have governments implement the right procedures. Right now, we have antigen testing, which is faster and cheaper than PCR testing and just as reliable. But many governments around the world still require passengers to have PCR tests. So again, that makes it really challenging for the recovery.”
Looking ahead into the next 20 years, IATA predicts that air travel is going to double around the world. To respond to these predictions, however, airports need to continue their investment in infrastructure. “It’s so critical to have the right infrastructure and airports have done a fantastic job during this crisis,” he says. “Airports like Orlando, JFK, LaGuardia and Chicago have continued to develop their infrastructure even during this downtime, and they will be better positioned in the years to come to welcome passengers.”
State of the airport industry
ACI-NA’s Cornelius then took to the stage to provide an overview of the state of the airport industry in the US and Canada. “The COVID-19 crisis has exposed dramatic differences in the impact of policies on the airport industry and the aviation industry as a whole,” he explained. “For the US and Canada, it’s really a tale of two countries.”
In the US, he said, the aggressive vaccination campaign and the relaxation of state and local restrictions have stimulated an impressive resurgence in traffic. According to figures from the US Transportation Security Administration (TSA), the low point for traffic in April 2020 showed 88,000 people clocking through the security systems in one day, compared to nearly two million people who passed through a security checkpoint screening on 11 June 2021.
“Luckily for the US, our domestic market is certainly one of the largest in the world and this resurgence of domestic travel is enough to make our airports feel confident in that recovery that is happening,” shared Cornelius.
Meanwhile in Canada, COVID-19 measures and travel restrictions have remained in place throughout the pandemic causing devastating impact not only on the aviation industry but also on national and local economies. Most airports in Canada are currently forecasting to achieve a mere 10% of the pre-crisis 2019 traffic levels in 2021, compared to US airports who are expecting passenger traffic at around 75%. “The Canadian government really needs to look into the importance airports play in serving their communities and make a turn and start supporting the industry,” urged Cornelius.
He continued: “The bottom line is that the impact of COVID-19 on airports and the financial wellbeing of airports in the US and Canada cannot be overstated.”
Indeed, the pandemic is projected to cost US airports more than $40 billion and Canadian airports more than $5.5 billion by March 2022. So far, the federal government in the US has provided $20 billion in relief packages to keep the airport industry afloat. However, the association also estimates that America’s airports need $115.4 billion for necessary infrastructure projects over the next five years. These are projects that, if funded appropriately, would help address critical needs to improve the passenger experience, increase convenience, enhance security, expand competition, and ultimately lower prices for travelers.
In conclusion, Cornelius said: “Airlines and airports have really come together as an industry. We’re speaking with one voice with the government. It’s not as effective as we like it to be, but we will keep it up and hopefully fill that hole that still exists.”