The International Air Transport Association (IATA) has said international airfares are likely to continue rising from their current highs for the next 10 to 15 years, with sustainable fuel costs expected to drive up ticket prices. Tuesday, June 6, 2023.
Airfares to many destinations have significantly increased due to the high travel demand since the end of the Covid pandemic. According to IATA, consumers should anticipate paying more for air travel. This increase is mainly because airlines are using more scarce “greener” jet fuel to comply with government recommendations on carbon emissions reduction in the aviation sector.
Willie Walsh, who is the Director General of the International Air Transport Association and CEO of British Airways, stated that there will be a growing demand for sustainable aviation fuels, which will result in higher fares for an increasing number of flights.
Walsh stated that sustainable fuels could become cheaper than kerosene, but he also mentioned that fuel prices might go up in the next 10 to 15 years unless there is a cut in prices. He did not see any potential for a reduction in other costs, and as a result, people should anticipate a gradual rise in average ticket prices.
He explained that the use of sustainable aviation fuel would result in higher airfare compared to conventional jet kerosene due to its higher cost. He also added that achieving zero emissions would require some financial investment.
The cost of air travel has gone up because of several factors including the increase in oil prices following the Russian invasion of Ukraine and higher labor costs. Additionally, some airlines are facing capacity limitations due to a shortage of spare parts, which is preventing them from operating their full fleets.
Airline prices did not prevent travel
Despite the high airfares that passengers had to pay on their trips to many destinations this summer, IANA says its analysis shows that ticket prices around the world are still at 2019 levels in real terms in 2023, given that they have not kept pace with inflation during the time of the pandemic.
Last year, Ryanair said the era of super-cheap travel may be over. The next impact of sustainable biofuels was outlined in a recent update to the UK’s Sustainable Aviation Roadmap to Zero Emissions by 2050, which relies on carbon offsetting and sustainable aviation fuels, replacing existing fleets with fuel-efficient aircraft. to reduce emissions.
While the update predicted that the number of people who will travel by air will decrease in the coming decades because ticket prices will exceed their financial capacity. However, airlines report higher tariffs collected despite the higher fares.
Sir Tim Clark, president of Emirates Airlines, said the unexpected demand for air travel, even in premium cabins at high prices, defied economic wisdom. “Last winter, in front of every seat we sold, there were five other people who wanted it… We could have put it up for auction if we wanted,” he added.
He said that people who used to use the old fares are now struggling to use the new fares. The situation doesn’t seem to make sense, but since they are transitioning to them, they will just have to accept it and move on.
