According to David Curmi, Executive Chairman at Air Malta, while the pandemic appears to be contracting, operational costs are soaring, meaning airlines are being forced to carefully consider how to optimise seat load factors.

This, he explains in a blog post writing in his personal capacity and published on BusinessNow.mt, means that “airlines will no longer allocate capacity at any cost.”

Ensuring the highest possible seat load factors is a “critical factor for [airline] survival,” he expanded, alongside optimising their network for “profitability rather than for volume.”

Mr Curmi was writing after several local media reports found that Malta appears to have lost airline capacity compared to other Mediterranean destinations, claiming that this factor alone casts doubts on Malta’s ability to stage a full recovery of the tourism sectors.

Some of these reports, the business leader added, suggested that this reduced capacity was due to Malta’s restrictive travel rules and protocols related to COVID.

However, while he acknowledges that these restrictions are “certainly a consideration” every airline takes when planning its route network, he responds that it would be wrong to conclude that this is the sole reason airlines have reduced capacity.

“The first factor that airlines take into consideration when planning their networks is the projected passenger movements to and from specific destinations – the demand,” he points out.

“Whilst post-COVID such forecasts are less reliable, there exists an important universe of sources of such data that airlines use in addition to their own proprietary data. Long term forecasts have become more difficult to produce but are vital for an industry such as aviation where long-term planning is required.”

Another takeaway Mr Curmi provides is that airlines have no choice but to continue to actively seek to increase their revenues and reduce their costs of operation on their aircraft to make them sustainable, leading him to predict that there will be “major shifts” in the market, including the possible narrowing of prices between low-cost carriers and other airlines.

Looking to the future, Mr Curmi also warned that the achieving of pre-COVID passenger movements will be reached in 2025, rather than by late 2024, as had been projected in 2021.

“The competition for airline capacity in the Mediterranean will intensify and how airlines distribute capacity across their network will not be determined by restrictive travel rules but by purely economic considerations,” Mr Curmi concluded.