By Joanna Plucinska
FARNBOROUGH, England (Reuters) -Demand for air travel has normalised after a years-long boom following the COVID-19 pandemic as holidaymakers and travellers baulk at higher fares, executives at major airlines said at the Farnborough Airshow on Monday.
Guliz Ozturk, CEO of Turkey’s low-cost Pegasus Airlines, said the airline expected yields – a measure of average fare paid per mile by each passenger – to be flat as customers go “back to basics”.
Travellers are looking for the most cost effective way to travel, she said.
“We have started seeing the normalisation of demand. What does it mean? I mean, the demand is there, but now the travellers are looking for, as before the pandemic, for the most affordable, the lowest, the best price for their travel,” she said.
Air India CEO Campbell Wilson said he expected the international market to moderate for the next six months, while the CEO of BA-owner IAG, Luis Gallego, said business travel was still recovering from the COVID crisis when travel almost ground to a halt with borders shut and planes grounded.
The comments come after Ryanair reported earlier on Monday a bigger than expected drop in quarterly profit as fares plunged 15%, with management saying that ticket prices were continuing to deteriorate.
Gallego said demand was still strong for flights within Europe, but yields were under pressure, which was reflected in the Ryanair results.
(Reporting by Joanna Plucinska; Writing by Josephine Mason; Editing by Louise Heavens and Mark Potter)
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