Avolon’s Optimistic Forecast: Airline Traffic Reaching Pre-Pandemic Levels By June

Avolon’s paper on global airline traffic is a much-needed look at the current state of the industry, and a hopeful outlook for its future. After a tumultuous year of losses, airlines have been able to recover to near-pre-pandemic levels of traffic. It is largely due to the strength of Europe and North America last year. Looking forward, Asia is expected to lead the way in the coming year, as Chinese airlines re-enter international markets.

The industry is also in a much better financial position than it was a year ago, with forecasters predicting the sector to turn a profit of $4.7 billion in 2021. However, the authors of the report note that capacity recovery is lagging behind the financial recovery, and delivery delays have become endemic as an aircraft shortage emerges. This has led to an increase in lease rates and opportunities for well-capitalized investment-grade lessors.

The paper also addresses the need for greater progress in addressing the long-term environmental impact of aviation. Sustainable aviation fuel (SAF) production tripled in 2022. Still only represents 1 percent of the amount targeted for production in 2030. The authors estimate that $250 billion in investment and collaboration between all industry stakeholders will be needed.

Overall, the paper paints a picture of optimism for the airline industry, with the potential for full recovery in the coming months. With the right investments and collaborations, the authors believe that the sector will remain strong and resilient in the face of future challenges.