Aer Lingus owner IAG could benefit from pent-up demand amongst Americans who say Europe is their number one planned destination once borders reopen, according to a survey from Bank of America.
t added that European airline bookings hit their highest level last month since March 2020.
IAG, whose chief executive is Luis Gallego, also owns British Airways, Iberia and Vueling.
“IAG is well placed to benefit from a resumption in travel and the easing of travel restrictions in the US, UK and Europe in 2021 should lead to a demand recovery,” noted a Bank of America global research report.
“Our global travel survey in March showed that Europe is the most popular travel destination for US respondents once borders reopen, and we expect IAG to benefit from this pent-up demand,” it added.
Visitors from the United States were last week removed from the mandatory hotel quarantine list in Ireland. However, they are still meant to observe a home quarantine.
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Despite the upbeat outlook from Bank of America, the initial transatlantic recovery may start to come too late to help Aer Lingus this summer. Overall transatlantic traffic recovery is also expected to lag the recovery of intra-European flights. That will see carriers such as Ryanair benefit quicker as the pandemic recedes.
The report from Bank of America noted that in intra-European airline bookings continued to improve in the week ending May 23, and were at 68pc less than 2019 levels at that date.
It said that daily website visits for EU airlines have improved significantly, with Ryanair and Iberia seeing strong performances.
Ratings agency Fitch said yesterday that pent-up demand for leisure travel will be the main driver of air traffic recovery in the medium term.
“Carriers that are better positioned to benefit from these trends are low-cost carriers such as Ryanair and Wizz Air,” it noted. “Other airlines, typically network carriers, such as British Airways and Etihad have larger exposure to long-haul travel and will find it harder to recover traffic.”
Ryanair said yesterday that the overall group – which includes Ryanair, Malta Air, Lauda and Buzz – carried 1.8 million passengers in May, compared to just 70,000 in May last year. Its load factor hit 79pc last month. Of the passengers carried in May, one million were with Ryanair itself.
Dublin-based Crewlink, which is the official recruitment partner of Ryanair, has begun a recruitment drive for cabin crew as the airline starts to see passenger growth again.
