The Russian airline industry experienced a huge decline of 54.5% in 2020 due to the COVID-19 pandemic, but it saw strong growth of 60.8% in 2021, as lockdown restrictions were eased and the economy recovered. However, with the onset of the Russia-Ukraine conflict and the sanctions imposed on Russia in 2022, the industry is expected to decline. Nevertheless, it is predicted to recover strongly over the forecast period of 2021-2026.

With 227 operational airports registered with the Federal Air Transport Agency, Russia has a significant number of airports due to its status as the world’s largest nation.

The Russian airline industry had total revenues of $24.4 billion in 2021, with a compound annual growth rate (CAGR) of 3.5% between 2016 and 2021.  

The lifting of travel restrictions in 2021 led to a surge in domestic and international tourism, resulting in industry growth. Despite its size, international flights were more prevalent in the industry before the pandemic, but this could shift as internal flights become more common.

Industry consumption volume increased with a CAGR of 4.9% between 2016 and 2021, with a total of 142.1 million seats sold in 2021. However, the volume is expected to decrease to 113.5 million seats sold by the end of 2026, representing a CAGR of -4.4% over 2021-26.

Russia’s vastness and low population density make it an underrated tourist destination, with huge unpopulated regions that appeal to those looking to escape and explore. Visa-free travel for Chinese groups has been introduced to boost tourism, and more Mandarin-speaking staff have been hired at airports to improve the travel experience.

In 2021, the full-service segment was the largest proportion of the industry, with total revenues of $17.0 billion, equivalent to 69.9% of the industry’s overall value. The charter segment contributed revenues of $7.0 billion in 2021, equating to 28.8% of the industry’s aggregate value.

The successful 2018 FIFA World Cup boosted tourism and strengthened the airlines industry, attracting over five million visitors to attend matches in 11 different cities in Russia.

The performance of the industry is expected to decelerate, with a CAGR of 2.2% over 2021-26, leading to a value of $27.2 billion by the end of 2026.  

The Russia-Ukraine conflict is expected to impact the operations of various domestic and international airlines, exacerbating operational issues and leading to bottlenecks as no-fly zones are avoided. The sanctions imposed on Russian airlines will likely hamper industry growth in 2023.