The Impact of the COVID-19 Crisis on Air Travel Demand: Some Evidence From China

Abstract

This paper applies a three-step framework to quantify COVID-19’s impacts on China’s domestic and international air travel demand and to evaluate how the impacts evolve from January 2020 to January 2022. Time series techniques and combination forecasting are tested to identify the best-performing model to generate baseline forecasts, with which actual demands are compared to assess the impact of COVID-19. The results demonstrate that during the period under study, China’s domestic aviation sector experienced two V-shape recoveries, while its international counterpart was devastated and showed no sign of revival. It suggests that to mitigate the impact of COVID-19, containing virus spread and removing mobility controls are essential; and when travel restrictions are lifted or loosened, governments play important roles in accelerating the rate of demand recovery.