UK's second lockdown undermines UAE airlines comeback efforts

Dubai: The UK’s second lockdown has placed airlines, especially those in the UAE, at a disadvantage especially as demand was starting to build up on the route.

But this will not distract these airlines, with Abu Dhabi’s Etihad Airways confirming it will not be dropping its twice daily flights to Heathrow as a “result of the lockdown in parts of the UK”.

Keep signing

UAE airlines will, no doubt, take encouragement from the growing support for the UAE’s inclusion in the UK’s ‘travel corridor’ list. “There are 250,000 UK citizens living in the UAE - COVID-19 PCR tests are readily accessible in the UAE and travellers are able to test prior to flying,” a petition to this effect says.

An air travel corridor is an agreement between two countries that allows passengers to travel without a quarantine requirement. The petition - which is up on the UK government website -has received 20,000 signatures so far. At 100,000 signatures, this petition will be considered for a debate in the UK Parliament. (The petition was started by one Paula Jacobson, who is the Director of People & Culture at Huda Beauty.)

Four-week break

The current lockdown is set at four weeks, and has generated sufficient heat from those wanting one in place and those who think this is the wrong way for the UK to go about it. And especially what it will mean for the economy and businesses, still far from recovering any of the pre-COVID-19 sentiments. Plus, there is the Brexit cut-off that looms by year-end.

Tailing off

Booking enquiries for London flights have already slowed - but ticket rates will more or less remain the same despite that.

“Passenger flows have been badly damaged by multiple lockdowns and travel restrictions, and consequently traffic is running at around 30 per cent load factor compared to 85 per cent plus last November,” said John Grant, partner at Midas Aviation.

“The loss of revenue will be running into millions of dollars for the carriers concerned and, of course, the latest lockdown will damage that even further.”

Travel to the UAE from the UK had been showing signs of recovery prior to this. Emirates even began flying its A380 jets to Heathrow as early as July to meet rising demand.

A one-way flight ticket to London Heathrow will cost around Dh1,100 on British Airways and Dh1,500 on Emirates.

Hitting a turbulence

Another key route for UAE airlines, the US, is facing its own share of issues. Most direct flights remain closed due to the pandemic, and the US is still some days and weeks away from capping its daily COVID-19 infection rates.

Emirates and Etihad are not running their full suite of flights to the country. Ticket rates are “a little higher as most of connection flights are yet to open - basically the connections are via UK and Europe routes,” said a spokesperson for Regal Tours Worldwide.

A flight from Dubai to New York’s JFK airport will cost about Dh3,400 for the next two to three weeks, and those to Los Angeles will be at about Dh3,800. For Dubai travellers, San Francisco will prove to be the costliest with fares at about Dh4,800.

Need a way back

This is a major setback for UAE’s carriers after having invested heavily to expand their US services. The US “is an important one not only for point-to-point traffic to and from the Gulf, but for the significant connecting flows to the Indian Subcontinent and Africa,” said John Strickland, director of London aviation consultancy JLS.

“The inability to carry normal levels of passenger traffic naturally has a significant impact on revenues. All carriers will be hoping for some advancement in pre-departure testing and an agreement by governments to do this so that the market can reopen.”

But it will take longer

“It’s going to be at least five- to seven years before any degree of traffic normalcy returns – and that is contingent upon a vaccine or medicinal suppressant to COVID-19,” said Saj Ahmad, chief analyst at StrategicAero Research. “Demand for travel from the UAE to the US will remain choked for a long while to come.”

Connecting those networks

Grant said that the US market is much more tuned to “Indian Subcontinent connecting flows”, which have been “badly damaged”. “The pandemic has highlighted the risk of being a major hub airport totally reliant on international connecting traffic.”