The aviation and travel industries face a “tough” 2023, Virgin Atlantic chief Shai Weiss has warned.
Speaking at the Airlines 2022 conference in London, Weiss said: “Who would have thought after three years of pandemic we would be facing such a difficult situation?” He told aviation industry leaders: “The looming UK recession is a big deal.”
Weiss described this summer’s demand as “robust” and said: “We still have Christmas, New Year and Easter. But I am not underestimating the challenge of 2023. Optimism is not really a virtue in planning.”
He argued: “In 2022, Virgin Atlantic will surpass our flying in 2019 with 20% less capacity. We have a positive attitude. But we can’t fight the [economic] cycle.
“The good thing is we have a stable government now and a stronger pound. But it is going to be a tough 2023.
“We need the price of energy to come down, inflation to come down and growth to enter the equation because the Office of Budget Responsibility [OBR] has forecast the economy won’t return to its pre‑pandemic level until 2024.”
However, Weiss added: “From Covid, I take the lesson that we can rise to any challenge.”
Manchester Airports Group chief executive Charlie Cornish told the conference: “We need the government to have a sensible growth plan. UK aviation growth is linked to UK economic growth, so we need an economic growth plan.”
The OBR estimated the UK economy was already in recession when chancellor Jeremy Hunt made his autumn financial statement last week, and the economy is forecast to shrink by 1.4% in 2023.
Disposable household income is forecast to fall by a record 7.1% over two years and the economy only return to its pre-pandemic level in 2024.
Heathrow chief executive John Holland-Kaye argued: “If we want a successful UK economy, we need a successful aviation industry and connectivity to global markets.
“Some people would like to kill the [aviation] golden goose with taxation. We need a balance to ensure UK aviation can thrive and fund a green transition.”