AIR passenger traffic will rebound in 2021 by between 94.2% and 100.3% year-on-year (yoy) which translates to 51.7 to 53.3 million passengers, according to the latest Malaysian Aviation Commission (Mavcom) estimates.
This is given airlines are expected to gradually expand seat capacity as international travel restrictions are presumably lifted in 2021.
However, Mavcom caveated that the forecast relies chiefly on the performance of the industry which is dependent on a range on external factors including the pathway of the COVID-19 pandemic, public health measures as well as consumer behaviour.
The projection is contained in the eighth edition of Mavcom’s industry report, Waypoint, which lays out the performance of the Malaysian aviation sector as of third quarter of 2020 (3Q 2020) as well as expectations for the rest of 2020 and prospects for 2021.
Mavcom has forecast in the June 2020 edition of Waypoint that passenger traffic this year would contract by between 48.7% and 50.3% yoy due to muted demand during the first five months of the year (54.3 million to 56.0 million passengers).
Given the expected lower load factor and longer period of seat capacity recovery by airlines compared to the previous forecasts, Mavcom has further revised its passenger traffic forecast for 2020.
The commission now expects a contraction in passenger traffic of between 72.8% and 75.7% yoy which translates to between 26.6 million and 29.7 million passengers this year.
Malaysia’s passenger traffic dropped to its lowest in Malaysian aviation history recording only 802,525 passengers in 2Q 2020 which signified a 97% yoy decline from 26.7 million passengers recorded in the second quarter of 2019.
This decline was largely attributed to the lower load factor and a longer period of seat capacity recovery by airlines as they continued to cut seat capacity.
However, passenger traffic recovered slightly in 3Q 2020, demonstrating a smaller decline of 83.3% yoy. This slight recovery was attributed to the easing of domestic travel restrictions.
Although the sector’s outlook is largely dependent on the pace of recovery from COVID-19 locally, regionally and globally, Mavcom is of the view that the aviation industry will be on a long road to recovery, according to Mavcom’s executive chairman Datuk Seri Saripuddin Kasim.
“Aviation has been one of the most heavily impacted sectors due to the COVID-19 pandemic not only here in Malaysia but also globally,” he noted.
“As a result, we see airlines adopting various measures for business sustainability, including retrenchment and debt restructuring.” – Dec 8, 2020
