End of China’s zero-Covid policy fuels flight bookings, says ForwardKeys

Sharp jump in demand for travel for Chinese New Year
/ New Delhi
End of China’s zero-Covid policy fuels flight bookings, says ForwardKeys

On December 26, China removed all Covid-19 related restrictions on domestic air travel and bookings surged again

With the sudden and surprise end of China’s zero-Covid policy recently, there has been a rapid surge in travel bookings, especially with the Chinese New Year round the corner, says a report by ForwardKeys.
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China’s decision last month to end its zero-Covid policy has triggered a surge in flight bookings, according to the latest data from aviation and travel market research firm ForwardKeys.

On December 7, Chinese authorities announced that a negative PCR test would no longer be required for air travel between provinces, says a report by ForwardKeys, adding that domestic flight bookings immediately surged 56 pc on the previous week and continued to spike, increasing by another 69 pc the following week. On December 26, China removed all Covid-19 related restrictions on domestic air travel and bookings surged again, reaching 50 pc of 2019’s level in the final week of the year, says the report.

As of January 3, domestic flight bookings during the upcoming Chinese New Year period, January 7 to February 15, were 71 pc behind pre-pandemic levels of 2019 and 8 pc behind last year, with the most popular destinations being Beijing, Shanghai, Chengdu, Kunming, Sanya, Shenzhen, Haikou, Guangzhou and Chongqing, says the report. Before the announcement on December 7, they were 91 pc behind 2019.

China’s aviation regulator plans to restore flight capacity to 88 pc of pre-pandemic levels by January 31, says ForwardKeys, adding however, a full recovery is not possible immediately, as the industry needs some time to re-hire staff and meet all flight safety and service requirements.

The report says that other measures announced on December 26, and taking effect on January 8, were the end of the cap on the number of international flights to China and quarantine measures. In addition, Chinese citizens can now renew expired passports and apply for new ones.

Outbound flight bookings between December 26 and January 3 jumped 192 pc compared to same period last year, but they are still 85 pc behind pre-pandemic levels. Currently, the most popular return trips are to Macau, Hong Kong, Tokyo, Seoul, Taipei, Singapore, Bangkok, Dubai, Abu Dhabi and Frankfurt. Notably, bookings to Abu Dhabi which has traditionally been a major gateway between China and the West, are 51 pc behind 2019. Looking at onward bookings from there, 11 pc will go to Paris, 9 pc to Barcelona, 5 pc to London, 3 pc to Munich and 3 pc to Manchester. The report adds that 67 pc of bookings made between December 26 and January 3 were for travel during the Chinese New Year period.

“Although Chinese New Year is likely to see international travel rebound for the first time in three years, we will need to wait longer before we see a resurgence in Chinese tourists exploring the globe. The reasons are: First, current scheduled international flight capacity is only at 10 pc of 2019’s level; and owing to approval requirements for traffic rights and airport slots, it will be difficult for airlines to gear back up in less than a few months. Second, Ticket prices remain high, with average air fares in December 160 pc higher than in 2019. That said, there has been a downward trend since June, when quarantine was reduced from three weeks to seven days, and then to five days in November,” says Olivier Ponti, VP Insights, ForwardKeys.

“Third, some destinations, including the US, the UK, India, Qatar, Canada, Australia and all 27 EU member countries now require a pre-flight Covid-19 test for Chinese visitors; and others, such as Japan, South Korea and Italy, will impose testing on arrival and quarantine for those who test positive. Finally, a bottleneck processing passport renewals and visa applications is likely; and some countries, such as South Korea and Japan, are restricting short-term visas for Chinese travellers until the end of this month. Right now, we expect the Chinese outbound market will pick up strongly in Q2 2023, when airlines schedule capacity for the spring and summer, which include the May holiday, Dragon Boat festival in June and summer holidays,” Ponti adds.

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