How Has COVID-19 Affected The Aviation Industry

With the spread of the COVID-19 pandemic, the aviation industry has had to go through significant transformations. Since March when the spread of the contagious virus started to take an upswing, airlines have had to face some unprecedented circumstances and take some immediate and unwanted decisions. 

When the spread of the virus was at its peak, the demand among travelers soared up too. When the nationwide lockdown was first declared it was a new situation for everyone. This instilled among people the urge of returning to their hometowns with the hope that they would be safe in their known lands. Presently as things are slowly getting a bit normal, commercial airlines are undergoing a severe recession due to travel restrictions and a slump in demand among travelers. Except freight companies like Amazon Prime Air, FedEx, UPS, and Atlas which have grown exponentially, which is great news! 

Laying off Airline Employees - 

The safety issues and slump in regular industrial works have caused a significant reduction in the number of airplane passengers. This has transpired in the cancellation of flights and empty airplanes flying between airports. The revenues for airlines have frightfully dwindled and compelled many airlines to lay off their employees or declare bankruptcy. Some airlines have tried to save their earnings due to the pandemic by "Fleet Simplification", that is, reduction in flying and parking of Airplanes. Other authorities related to the aviation industry like the aircraft manufacturers and airport operators have also laid-off employees for similar reasons. Some professionals from the aviation industry have also stated that the occurring crisis is the worst ever experienced by the aviation industry.

Flight cancellations - 

Early March 2020, when the pandemic first hit the nations worldwide 10% of all flights, including Delta Air Lines, United Airlines, American Airlines, Southwest Airlines, Lufthansa, and so on, were canceled. As the pandemic progressed in the late March, 40–60% fewer flight movements were recorded with severe impact on the international flights. By April over 80% of airplane activities were restricted across all regions. 

The airlines were mandated to refund fares for canceled flights by the government regulations in Europe (known as the Rule 261) and the United States. But in many cases, airlines offered vouchers or travel credits that have validity till the end of the year instead of the flight fare, with some airlines extending the validity window of the vouchers to May 2022. The industry lobbyists have made several appeals to expand the regulations to allow travel credits to render some relaxation to the passengers but the US Department of Transportation has repeated that airlines are obligated to give cash refunds for canceled flights.

Owing to the surge in the spread of the COVID-19 virus, there has been a record reduction of 80% in airplane movements in the aviation sectors across all geographies, including America, Europe, Asia-Pacific, and so on. Thus the travel vouchers have currently been allowed for passengers who cancel trips due to travel alarms, the government issued orders to stay at home, and other restrictions.

Impact on Aviation in - 

• The United States of America - 

The passenger airlines in the United States have always been owned by private companies as they have no single flag carrier. The three major international carriers in the U.S are namely Delta Air Lines, American Airlines, and United Airlines, and with eight additional large carriers that mainly operate domestic aviation.

As the COVID-19 outbreak hit the mainland multiple airlines waived fees for booking changes in the flight schedules and cancellations following a request from United States Senator Richard Blumenthal. The stock prices in US airlines diminished by 30 percent and airplane fares for domestic flights toppled down. 

The United States Senate passed a bill on 25th March that allots to the aviation-related companies an amount of $58 billion in loans and guarantees, which includes $25 billion for passenger carriers, $4 billion for cargo conveyances, and $17 billion for the corporations like Boeing which are "critical to maintaining national security". This stimulus does come with some terms and conditions as the airlines accepting them are hindered from granting dividends, rising executive pay, or buying back shares during the period they are receiving the financial assistance.

 

• Compass Airlines(North America) - 

The 14 year legacy of the Compass Airlines came to an end on April 5, 2020, as the agency terminated operations due to reduced travel demand arising from the COVID-19 pandemic, in addition to the failed endeavors of their owner to secure additional flying. 

 

Safety Measures Being Followed by the Airlines - 

The Aviation community worldwide including the airlines in the United States, has issued hygiene and precaution norms to ensure the safety of the airline crew and passengers. 

 

Some of them are -  

1. The airline has launched a tool to help the customers keen to travel to quickly see the current COVID-19 travel guidelines. 

2. Customers are provided with a Hand Sanitizer free of charge on all the flights of American Airlines. 

3. Enhanced Cleaning of airports and airplanes. 

4. Limited the delivery of eatables on board to decrease touchpoints between customers and staff. 

5. Mandatory wearing of Face Coverings for pilots, flight attendants, and passengers. 

6. Some airlines like Delta Airlines are also blocking the middle seats in their flights. 

7. Limiting the load on flights and allowing customers to change their flights free of cost. 

8. Using electrostatic sprays to clean the airplanes. 

 

Estimated Recovery Time Of The Aviation Industry - 

As most countries have moderated international and domestic travel, it's estimated that the global retrieval of passenger demand to pre-COVID-19 pandemic statuses can take about 2.5 years on average. The most optimistic estimate of the recovery time is 2 years, and the most pessimistic estimate of the time is about 6 years, all depending upon the rate of recovery of the entire tourism industry from the containment measures.