U.K., Europe Travel Restrictions Held Down IAG Q1 Capacity

International Airlines Group projects that it will take
“at least until 2023” for passenger demand to return to pre-pandemic
levels, according to the group’s first quarter earnings report.

Passenger revenue in the first quarter declined 88.4 percent
year over year to €459 million, and capacity for the quarter was just under 22
percent of capacity in the first quarter of 2020. For British Airways,
long-haul routes primarily were centered around cargo needs during the quarter,
as cargo revenue was up 42.3 percent year over year during the first quarter.
Travel restrictions in the United Kingdom and across Europe also dealt a hit to
short-haul demand, though BA reported “steady business travel demand”
on its routes between major European cities.

In the second quarter, the group expects to operate about a
quarter of the capacity it operated in 2019, though that is “uncertain and
subject to review,” according to IAG. The group is pinning hopes on the
opening of travel corridors, such as between the United Kingdom and the United
States, as well as “affordable, simple and proportionate testing” to
replace measures requiring quarantine and multi-layered testing and technology
including digital health passes and contactless technology in airports,
according to IAG CEO Luis Gallego.

“We’re absolutely confident that a safe restart to
travel can happen as shown by the scientific data,” Gallego said in a
statement. “We’re ready to fly, but government action is needed.”

IAG reported a loss of €1.07 billion for the quarter, an
improvement of €57 million compared with its loss in the first quarter of 2020.

IAG Q4 earnings

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