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Catalyzing A Quicker Recovery

GlobalData Says Air France’s ‘Bet’ On Leisure Travel A Good One

GlobalData says that Air France’s bet on leisure routes could catalyze a quicker recovery for the carrier as outbound leisure travel in France increased to 74.3% in 2020, despite restrictions severely reducing the total number of outbound trips.

The data and analytics company points out that with business travel demand suppressed, the airline must focus on serving high volume leisure routes and upsell premium cabins to high budget travellers to support a strong recovery.

Gus Gardner, associate travel and tourism analyst at GlobalData, said that: “Pre-pandemic, outbound leisure travel from France accounted for 72.1% of international trips in 2019. The increase in 2020 highlights that leisure demand is likely to be one of the most prevalent reasons for travel in the immediate recovery period as travellers look to escape their lockdown locations.”

Gardner continued: “Furthermore, GlobalData forecasts that outbound leisure trips from France will see a compound annual growth rate (CAGR) of 18.9% between 2021 and 2025, reaching 34 million international leisure trips by 2025. This shows the potential the leisure market holds and that Air France’s focus on leisure routes will put the carrier in a stronger position.”

He added that: “The introduction of Muscat, Zanzibar, and Colombo, as well as more flights to Miami and Papeete (Tahiti), all leisure-focused destinations, reaffirm the carrier’s bet on leisure travel’s strong rebound.”

Air France has announced the extension into winter of what are typically summer-only flights from Paris Charles de Gaulle to Seville, Las Palmas, Palma de Mallorca, Tangier, Faro, Djerba, and Krakow.

Said Gardner: “By extending these routes to typically warmer destinations in winter (other than Krakow), Air France is reaffirming its expectation that familiar, leisure-focused destinations will be in demand. A live GlobalData poll showed that 41% of global respondents will likely opt for international trips to the same destinations they used to visit pre-COVID when restrictions ease. Given that these routes were available pre-COVID, they could benefit from the increased desire among travellers to visit familiar destinations.”

And he observed: “This is a smart move by Air France as it benefits from additional revenue by satisfying the current market sentiment.”

According to a live GlobalData poll, 28% of global respondents have revealed that their travel budget has increased either ‘slightly’ or ‘a lot’ since the start of the pandemic. These consumers should be a prime target for Air France’s long-haul business class.

Gardner explained: “The carrier’s focus on some luxury-orientated long-haul leisure destinations this winter will present ample opportunity to upsell the business class experience to leisure travellers, especially those with a higher budget. Pre-COVID business travellers were the backbone of premium revenue, but with demand down, leisure travellers must be the prime target. Business class should be promoted by Air France as a luxury start and/or end to a holiday. By upselling to leisure flyers, the carrier could mitigate against the loss of business demand, protecting against the loss of revenue.”

Go to www.globaldata.com for more.

 

Posted in Airlines, COVID-19, News, Trends & Research

 

 

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