Low-cost carriers on short-haul routes are leading the recovery in air travel, according to the latest research from analysts at UBS, even with concerns about virus spikes in parts of Europe.
“Over the last days concerns around stricter restrictions in Austria/Germany have negatively impacted sentiment on the sector bringing doubts to the consensus expectations for a strong short haul/leisure recovery in FY22.”
Austria today imposed a lockdown on two million people who have not been fully vaccinated against the virus.
“Notwithstanding the recent negative newsflow and acknowledging the shape of the recovery is unlikely to be linear from here we remain positive on the recovery into FY22 at this stage,” said UBS.
The numbers of flights are rising it noted, with WizzAir PLC, in particular, at 112% of pre-covid capacity for December, though all of the airlines are putting on more flights said the broker.
Ryanair’s capacity should rise to 83% of 2019’s level in the coming month, while easyJet is up to 69% from 59% in November.
Even the flagship transatlantic carriers are putting on more flights, with British Airways owner IAG up to73% from 64% last month and Lufthansa at 67%.
Transatlantic flights between Europe and the US resumed last week and passenger demand is said to have been good with capacity at 60-70% of pre-Covid levels, though this is down slightly over recent weeks due to worries about the spike In Delta variant infections in parts of the continent.
Shares in IAG ticked up to 164.5p, easyJet PLC dipped 1% to 592.2p and Ryanair down 0.6% to EUR16.78.