Etihad Airways said a surge in premium-seat sales is being overwhelmingly led by huge pent-up demand for long-haul holidays and journeys to see friends and family following two years of coronavirus curbs.
Around 90 percent of business-class bookings with the Gulf carrier are coming from people making leisure trips, up from about 45 percent before the pandemic struck, Chief Executive Officer Tony Douglas said in an interview with Bloomberg Television on Friday. He referred to the phenomenon as “revenge tourism.”
For the latest headlines, follow our Google News channel online or via the app.
“It’s an indication of the amount of latent demand for people to be able to get back to that sense of normality, to be able to travel, see family, loved ones and amazing places around the world,” Douglas said. “People are prepared to trade up now for space and get a better experience.”
The easing of COVID-19 restrictions has been accompanied by sales increases of 800 percent in 72 hours in some markets, according to the CEO, who said that 12 of Etihad’s routes are currently operating full.
Douglas told Bloomberg on April 7 that Etihad had turned profitable in the first quarter, making it possible the Abu Dhabi-based company will post positive earnings for all of 2022, a year ahead of target. Demand is currently sufficient to absorb higher oil prices and the carrier has coped better with the pandemic than many others after a major downsizing that began in 2017.
The CEO, who has focused Etihad on just two plane types, the Boeing Co. 787 and Airbus SE A350, said it could almost use more aircraft right now, and needs to have the flexibility in its fleet as demand fluctuates. The carrier has 11 more 787s on order plus 12 A350-1000s, of which the first five are arriving this year. Two of eight A350 options are also being converted to orders.
While airlines are reaping a revenue boost from the strengthening of premium demand, it’s not clear whether the leisure-led surge will be sustainable once people have completed the most pressing journeys. Corporate sales are also improving, though in some markets that’s been limited largely to small and medium-sized firms, with the biggest businesses not yet traveling as widely.
Douglas said that “China may well be closed for the rest of this year, continuing to deny airlines access to a market that’s been an engine for growth over previous years.” He said freight demand, which became a major revenue driver in the pandemic, should remain strong through the rest of 2022.
Read more: US to no longer enforce mask mandate on airplanes, trains after court ruling
