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AVIATION OUTLOOK


A car park doubles as parking space for Boeing 737 Max aircraft


increasingly removing discounts from contracts for domestic and intra-European routes, so buyers must think tactically to achieve savings. “It’s the intercontinental business class tickets where buyers should focus,” he says. “These tickets are in the higher cost brackets, £3,000-£5,000, where every incremental saving makes a difference.”


HIGH LOAD FACTORS


Airlines are flying with fuller planes, and they even broke last year’s global record, rising to 81 per cent, according to IATA. Intercontinen- tal and Atlantic routes, in particular, are busy, with overall fare levels from the UK predicted to remain stable. As airlines manage capacity carefully, don’t expect them to be willing to offer discounts in the short term. “It doesn’t help that 2019 is shaping up to


be another bad year for European air traffic management. While Europe is an extreme case, air traffic bottlenecks are also found in China, US, the Middle East and elsewhere,” explains Perry Flint of IATA. “Another area of concern is airspace closures. We’re seeing extensive airspace shutdowns owing to political tensions. These closures have contributed to longer and less efficient routings, higher operating costs and increased carbon emissions.”


ECO-TAX ON AIR TRAVEL Carbon emissions are, of course, another hot topic, and buyers will need to factor in the new French eco-tax on air travel


86 SEPTEMBER/OCTOBER 2019 buyingbusinesstravel.com


BOEING 737 MAX: ‘NOT A SMALL DEAL’


the grounding of its 737 Max aircraft


Boeing is paying to airlines following


$4.9bn 4,700


the amount of compensation


100 customers worldwide.


SOURCE: BOEING


the number of orders for the aircraft from


The uncertainty around Boeing’s 737 Max aircraft continues – expect this to stretch way into 2020 and even 2021. An increasing number of airlines are grounding the aircraft, and Boeing recently paid out nearly US$5 billion to compensate customers. But it’s less to do with the number of


planes grounded, now numbering 300; it’s the ones that are on order that are now the issue. There are almost 5,000 orders for this top-selling, mid-range, fuel-efficient aircraft. “This is not a small deal,” says Olivier


Benoit, global air practice leader at Advito. “This could put pressure on the market, and impact buyers if we see ticket prices go up. It doesn’t help that there’s a lack of clarity on when it will be back in service. Eight-in-ten travel managers say they are also con- cerned about flying on this type of aircraft, according to a recent GBTA survey.” Chris Vince, director of operations at


Click Travel, adds: “We’ve seen increasing numbers of bookers now looking for more information on particular aircraft types, which aircraft fly particular routes, their age and their safety records.”


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