How much will airline tickets cost in the summer of 2020?
In June 2020, the cost of transportation on domestic routes is lower than 2019. July prices will be determined by demand. The main consumers of air services in the summer are tourists.
Rosaviatsiya reported that in April of this year, Russian airlines performed only 8% of the volume of transportation in April 2019. These numbers include evacuation flights. In May, the figures will be the same - 10% of the volume of transportation in May 2019.
Recently, it became clear about the rules for the carriage of passengers in airplanes. Some sanatoriums of the Krasnodar region will be able to receive tourists from June 1 - this gives hope for the recovery of the industry from June.
This is really about internal transportation. The latest recommendations of the head of government not to plan a summer vacation abroad make us think that international flights will not be restored soon.
The main target audience of airlines in the summer will be tourists. Other categories of passengers will not return to the aircraft soon. Many organizations are abandoning business trips due to the financial situation, and have long moved activity online.
All major tour operators announced their exit to Russia. Experts expect that airlines working with tour operators (regular and charter flights) will get the advantage of loading flights.
Experts do not yet talk about large-scale flight load figures. According to the most daring forecasts, in June, airlines can perform up to 25-30% of June 2019 volumes, and in July - no more than 50% of July 2019.
“For transportation to the resorts in June, regular flights of Victory, Aeroflot, etc. will be enough,” said Evgenia Konkol, director of Spectrum.
Market participants expect that the demand for air transportation will recover no earlier than the end of June or in July. However, this will happen with clarity about the possibility of rest and restrictions on Russian resorts and will start selling.
Market participants expect a surplus of transportation and possibly dumping amid low demand. Airlines have already suffered and are suffering huge losses.
Market participants considered that to reach profitability, regular flights in Russia should rise in price at least twice. But in a low-demand environment, airlines cannot afford such price increases.
The benchmark for pricing in resort destinations is tourist transportation, which will get the advantage of loading. Regular carriers in search of customers will have to offer a similar price to charters (and regular tourist flights) or preserve part of the fleet.
“There is a price bar below which it makes no sense for the carrier to fall. For example, the airline “Victory” announced prices in Sochi from 2.5 thousand rubles. This price is attractive to passengers, but other airlines cannot offer it. For comparison, earlier the cost of the flight Moscow – Sochi – Moscow was 10 thousand rubles, – said Konkol.
Tourist flights are now sold at the cost level. Tour operators are looking to lower the price by keeping it at last year's level to stimulate demand. There are no prerequisites for reducing the cost of flights.
Airlines still pay VAT for domestic flights, leasing, airport fees have not fallen in price, you need to pay salaries to crews. All these expenditures remained at the level of last year”.
According to the general forecasts of the surveyed experts, in June the cost of transportation will be lower (or similar) last year.
Source: atorus