While the period covers one of the largest events on Earth, the World Cup, the airline faced immense capacity constraints owing to the grounding of Airbus A350 jets for all of 2022, until the dispute between Airbus and Qatar (over accelerated surface degradation on the fuselage of many aircraft) was finally settled in February this year, paving the way for the return of long-haul A350 jets.
As A350s have returned, and capacity is able to increase, Qatar Airways has been able to resume operations to thirteen destinations, including Amritsar, India; Shanghai, China; and Windhoek, Namibia. The airline has also launched two new routes to Dusseldorf, Germany; and Santorini, Greece.
Passenger revenue saw a significant growth of 100% due to increased capacity and higher yields. Qatar Airways carried 31.7mn passengers, which is a 71% increase from the previous year. Passenger traffic for Middle East carriers has recovered in recent months, and the region is almost at 2019 levels as of April 2023. Middle East passenger traffic will double by 2040, approaching 515mn passengers.
Over the period of the World Cup tournament, the Qatari national carrier operated around 14,000 flights bringing more than 2.4mn fans from all six continents to Qatar, to witness the tournament.
Minister of State for Energy Affairs and Qatar Airways Group Chairman, His Excellency Saad bin Sharida al-Kaabi, praised Qatar’s transportation sector as “an emblem of its interconnectivity, connecting people from around the world and increasing business connections throughout the region”.
Qatar Airways Group Chief Executive, His Excellency Akbar al-Baker, said: “This year’s strong financial results are attributed to the strong passenger demand recovery and the team’s ability to cater to this demand, aided by our continuing network growth, market leadership, and the operational efficiencies delivered by our world beating team.
In the Middle East, the region’s return to profitability has been supported by a significant increase in the passenger load factor of almost 25 percentage points, outstripping the performance of the other regions. At the same time, Middle East carriers have been swiftly rebuilding their international networks and in March 2023, the region’s international connectivity had returned to 98% of its pre-Covid level.
Airlines worldwide are on course for near-record revenues of more than $800bn this year, according to the aviation sector trade body IATA, which doubled its industry profit forecast for 2023 to almost $10bn.
IATA’s director general, Willie Walsh, denied that fares were excessive despite the upgrade in the financial outlook. He said profit margins remained “wafer thin” and blamed airline suppliers for increasing costs.
After industry losses of $183bn in the pandemic years, Walsh said airlines were “en route to a profitable, safe, efficient and sustainable future”.
People are flying despite economic uncertainties, and airline industry operating profits are expected to reach $22.4bn in 2023, much improved over the December forecast of a $3.2bn operating profit. It is also more than double the $10.1bn operating profit estimated for 2022. 4.35bn people are expected to travel in 2023, which is closing in on the 4.54bn who flew in 2019.
Cargo volumes are expected to be 57.8mn tonnes, which has slipped below the 61.5mn tonnes carried in 2019 with a sharp slowing of international trade volumes.
Total revenues are expected to grow 9.7% year over year to $803bn. This is the first time that industry revenues will top the $800bn mark since 2019 ($838bn). Expense growth is expected to be contained to an 8.1% annual increase.
With the region being home to some of the largest airlines in the world, supported by significant fleets that keep on expanding. Airbus’ latest Global Market Forecast, regional airlines are expected to require 3,020 new passenger and freight aircraft deliveries by 2040, bringing the total fleet to 3,210 from a 2019 fleet baseline of 1,300 aircraft.
Consequently, airline fleet growth will trigger the Middle East aviation services sector to also ramp up significantly over the coming decade. Airbus expects the Middle East aviation services business to witness a 4.7% average annual growth until 2041, surpassing the global average (3.7%).
The author is an aviation analyst. Twitter handle: @AlexInAir
