Shortly after the start of the corona pandemic, the then management of Austrian Airlines assumed that demand would be permanently lower. It was decided to downsize the fleet. For example, the de Havilland Dash 8-400 and Airbus A319 models were parted with and the number of Boeing 767s halved on long-haul routes. Now the AUA can announce black half-year figures again.
At first glance, it sounds natural that Austrian Airlines would have been extremely successful in the first six months. However, one should not forget that in direct comparison with 2019, the average flight ticket prices have risen sharply, with inclusive services noticeably reduced - especially on short and medium-haul routes. On those routes where there is no competition, it has become particularly expensive. But if you have Ryanair or Wizzair as your "playmates", for example, AUA also offers cheaper ticket prices.
It is also noteworthy that shortly after the resumption of flight operations in June 2020, AUA publicly supported the minimum prices for airline tickets advocated by Transport Minister Leonore Gewessler (Greens) but not yet implemented. Gewessler's "demand" that "flying must become more expensive" was implemented and ultimately the higher average revenues contributed to Austrian Airlines being able to return to the black in the first half of 2023. But the environment has absolutely nothing to gain from this, because the effect hoped for by the Greens, that fewer people would fly with expensive ticket prices and, as a result, fewer planes would be in the air, simply did not occur.
Despite the high costs in everyday life: Many want to screw up their vacation - not again
Just like other airlines, also from the Lufthansa Group, AUA was able to benefit greatly from the fact that many people have not traveled or not been on vacation in recent years - also due to the propaganda-like calls from Austrian politicians to stay at home were. This year in particular there is an enormous catch-up effect and again many - regardless of the everyday price increases - do not want to let their holidays be spoiled. Spending time relaxing in Austria is not exactly attractive for many Austrians, because the domestic tourism industry has turned the price screw quite sharply this year. There is also a very simple fact in summer: Many people want to spend their holidays at the beach and a landlocked country like Austria simply cannot offer that.
Strategically, Austrian Airlines proceeded in a completely logical manner from the outset. Already in the previous year, it was correctly recognized that the demand from potential customers is less in Germany-Austria traffic, but on holiday routes. Based on the knowledge gained in the previous year, the offer for hot water destinations has been greatly expanded this year. In terms of sales, it is of course an advantage for AUA that, in contrast to Ryanair and Wizz Air, they officially cooperate with tour operators and have therefore also received bookings and charter orders from them. Some tour operators include the mentioned low-cost tours in package tours, but these are mostly so-called dynamic tours that are more or less individually put together automatically.
High demand and increased ticket prices are boosting the financial figures
In the second quarter of 2023 alone, Austrian Airlines was able to increase sales by 39 percent to 664 million euros. In the previous year, this value was 478 million euros. Total revenues improved from EUR 501 million to EUR 680 million. At EUR 592 million, total expenses in the second half of the year were 19 percent higher than in the previous year (Q2 2022: EUR 498 million). Due to the high passenger demand and continued high occupancy, the second quarter of the year closed with a result of 88 million euros (adj. EBIT Q2 2022: 3 million euros).
Austrian Airlines was able to increase its revenue significantly (+2022 percent) compared to the first half of 57 to 1,064 billion euros (first half of 1: 2022 million euros). Total revenues increased by 678 percent to EUR 2023 billion in the first half of 54 (first half of 1,093: EUR 1 million). Operating expenses increased by 2022 percent year-on-year to EUR 709 billion (first half of 32: EUR 1,078 million). The first half of 1 could therefore start with an adj. EBIT of EUR 2022 million (first half of 815: EUR -2023 million). The positive half-year result is mainly due to the further increase in passenger numbers. Austrian Airlines flew more than 15 million passengers in the first half of the year, which corresponds to an increase of 1 percent (first half of 2022: 106 million euros). The available seat kilometers rose by 6,1 percent to 47 billion in the same period (first half of 1: 2022 billion), with the flights operated by the Austrian airline having an average occupancy rate of 4,2 percent (first half of 27: 11,6 percent). ).
In other words: The combination of high demand and, in some cases, sharply increased ticket prices with once again reduced inclusive services has led to Austrian Airlines earning more money in the first half of 2023. For example, in the cheapest fare classes, you get an extra charge of around 25 euros per person and route for selecting your preferred seat. People who want to fly on vacation in particular are a welcome target group, as they often reach into their wallets to be able to sit in the seat of their choice next to their preferred seat neighbor. It goes without saying that AUA is happy about the extra cash that competitors in the low-cost airline segment have been happy to "take with them" for many years.
A320 fleet will be expanded by two machines
In view of the positive trend, Austrian Airlines is once again thinking about expansion. The fleet is to be expanded by two machines for short and medium-haul routes. As the management confirmed during the presentation of the figures, it will be an Airbus A320neo, meaning that this sub-fleet will be expanded to five units. In addition, the company will take over a used A320ceo aircraft from a sister company. According to their own statements, it should be a young model. Both will be floated next year.
But it is also clear that the short- and medium-haul fleet is getting on in years. Austrian Airlines is one of the world's last operators of the Airbus A321-100. These machines are scheduled to be replaced in the second half of the current decade. The oldest Airbus A320 will then also be on the receiving end. First of all, however, the modernization of long-haul routes has priority.
The first Dreamliners are used Lufthansa aircraft
Austrian Airlines will gradually replace the aircraft, which are spurned in aviation circles as a "museum fleet", with Boeing 787-9s. The first units will be taken over second-hand from Lufthansa. The cabin will not be changed either, as they will continue to fly in Hainan configuration. It has not yet been decided whether the aircraft that will later be taken over from the factory will be equipped with the Allegris cabin, which is being pushed by Swiss and Lufthansa, or whether the crane group will have a standard "off-the-shelf" product installed. It will be interesting to see whether or not Austrian Airlines will make a comeback of First Class if the Allegris cabin is introduced. We don't really know at the moment.
The current strategy of Austrian Airlines clearly speaks against the reintroduction of first class. The seating capacity of the Boeing 777 fleet has recently been increased and the technically permitted maximum is almost completely exhausted. Few other carriers offer such narrow seat pitches, at least in economy class. There is a reason for this at AUA: they want to offer more premium economy and business class, but at the same time not significantly reduce the capacity in the eco. A theoretically possible first class in the future 787 fleet would take up a lot of space and at the expense of the overall capacity of the machines. There is also a completely different aspect to this: first-class seats weigh significantly more and when they are empty, the fuel consumption and thus the costs are needlessly increased. It is therefore quite understandable that people will think twice before deciding whether to make a comeback for First Class or whether to leave it at the current Economy, Premium Economy and Business classes.
First Dreamliner, an A320neo and an A320ceo will be added next year
In principle, the Dreamliners will replace the long-haul fleet currently consisting of B767s and B777s. But it is also clear that there will be a longer transition phase. In this, the AUA will be on the road with all three models mentioned. It is therefore not surprising that it was announced that the first Boeing 787-9 will be used for growth and that no existing aircraft will immediately leave the fleet. The first used Dreamliner will be handed over by Lufthansa to Austrian Airlines in the coming year. Only after the second B787-9 will the three remaining Boeing 767-300ERs begin to be phased out. After that, the B777s, which are also getting on in years, will be removed step by step.
Incidentally, the new additions to the short and medium-haul routes will also be taken over in the coming year. As mentioned: This is the fifth Airbus A320neo, which will be brand new, and a used A320ceo, which will be taken over by a sister company. The two machines will serve the announced growth and strengthen tourist traffic in summer 2024.
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