Russia-Ukraine war impact: 46% to drop travel plans due to rising airfares, airlines could see 50% drop in revenues in March-May
The Russia-Ukraine war is now proving to be a damper for travel plans too. On Monday, oil prices surged, briefly touching $139 a barrel after the US said it was discussing a ban on Russian crude imports in the fallout from Russia’s invasion of Ukraine. Rising crude prices will have a direct bearing on airfares for both international and domestic air travel.
With rising airfares, 46% of the consumers who were planning air travel are likely to either take an alternate mode of travel or not travel at all while 14% are likely to wait for airfares to drop to book their travel. 26% of the consumers are likely to book it soon with high airfares and 14% of them have it already booked, according to a survey by Local Circles.
With crude oil prices unlikely to retreat soon as per most analysts, chances are airlines could see a drop of almost 40-50% in their revenues during the March-May period.
The survey received 10,389 responses from consumers located in over 301 districts of the country.
India's domestic aviation industry has been severely impacted by the pandemic in the last two years. Many families had to cancel their travel plans amid the surge of cases during both the second and third waves.
As cases of COVID started to spread across the country from early December led by the arrival of the Omicron variant, the Government extended the suspension of international flights further. Following that, various states and union territories also announced restrictions in mid-December to limit the spread of COVID, thereby making domestic travel even more challenging.
Many who had travel booked during the months of January-March 2022 revisited their plans and a subset of them approached airlines and hotels for cancellations. The rapid rise in Omicron variant-led COVID cases also prompted some airlines to cut down capacity and as a result, some of them waived off ticket rescheduling fees and permitted them to rebook an alternate flight till March 31st, this year.
06/03/22 Sunainaa Chadha/Times of India
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