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Making it to the other side
April 1st 2020
International Air Transport Association director general and CEO, Alexandre de Juniac, says for airlines COVID-19 is apocalypse now. Read More » It is not an exaggerated description of the situation given the damage the pandemic is wreaking on the global industry.
For airlines, the revenue black hole, and only if the crisis passes in three months, is estimated at US$252 billion. The Asia-Pacific component of that bill is $90 billion and climbing.
With no relief in sight from the worldwide travel bans – and no timetable for lifting border prohibitions for foreign travelers into most countries across the globe – the impact of the 9/11 terror attack, SARS (2003-2004) and the Global Financial Crisis (2008) pales into insignificance compared with the present calamity.
No-one has dared predict when the blight of COVID-19 will recede. In the past, airlines have bounced back relatively quickly from such setbacks but this time around the recovery is predicted to take longer and be U-shaped, de Juniac told Orient Aviation earlier this month.
What we do know is the industry post COVID-19 will be different. In the Asia-Pacific, not every carrier flying before the virus outbreak will be flying beyond it.
Some countries in our region have been quick in delivering multi-billion dollar rescue packages to airports and airlines to help them survive the crisis. Others, so far, have not.
Several Asia-Pacific carriers will emerge from the pandemic bloodied but back in the skies. The same cannot be said for a large number of the region’s LLCs. They operate on wafer thin margins. Most are privately-owned so they don’t necessarily have the support of governments – although a handful does. Many of them are on the way to being casualties of the pandemic. So too are some of the region’s once celebrated full-service carriers.
At such a dire time, airline, airport and air traffic management bodies are urging collective action to keep the skies safe. Even now, there are more than 5,000 aircraft flying every day due mainly to air freight demand for medical supplies from every day masks to hi-tech monitoring and resuscitation equipment.
In such extreme circumstances, is it unreasonable for governments to provide aviation with holidays on fees and charges and loans to help airlines keep flying in an industry critical to a globally connected world?
TOM BALLANTYNE
Associate editor and chief correspondent
Orient Aviation Media Group
