The demand myth

Most people expect demand for flying to grow. But what do we mean by ‘demand’?

Is it the steady rise in passenger number we've seen (bar Covid) over the past decade or so?

The definition of demand in economics is the willingness and ability of a consumer to purchase something. The actual number of passengers is what happens when demand meets the availability and price of flights. 

Demand probably has been increasing. A growing population and higher incomes both tend to increase the number of times someone somewhere is willing to book a flight. 

This growth in flying has mainly been driven by lower prices. UK residents made 73% more visits overseas in 2019 than in 1999 – the year that EasyJet first sold more than £1m worth of flights online.

Most of the growth in that time was in leisure travel, and it’s not a coincidence that the massive increase in flying has happened since low cost airlines like EasyJet and Ryanair have been on the scene. Low prices enabled all sorts of new flying habits.

It’s not a coincidence that the massive increase in flying has happened since low cost airlines have been on the scene.

Here are some types of flying that people didn’t used to do before low cost airlines – all of them real examples from real people.

• Having a lads’ weekend in Prague because once you factor in the price of beer, it’s cheaper than a weekend at home.
• Living in Northern Ireland and commuting to London by air because it’s cheaper than renting a flat in London.
• Organising a hen party in Magaluf because the bars there give you free drinks.
• Choosing to study at university in England because you can commute from your home in Eastern Europe via Luton Airport.

These are all rational choices, when flying is so inexpensive – especially if you don’t think about the impact on the climate.

But what would happen if the price increased? It would make flying less competitive with other forms of transport, which would probably lead to different choices being made.

Would a ruby wedding be celebrated with a family trip to Tenerife? Maybe they would celebrate with a party, a meal at a nice restaurant, or a rose for the garden instead.

What would happen if the price increased? It would make flying less competitive and reshape all kinds of choices.

Is it really flying that we demand? We demand good times with our families and friends. We demand memorable occasions. We demand access to work and education.

We have to figure out how we can have all of those things, and also demand a safe and peaceful future, and a good life for our children and grandchildren too.