By: Kirtika

How COVID Crisis hampered the Airlines?

The aviation industry was already struggling for quite some time and has forced to face the largest crisis ever in 2020. The industry suffered a major cash crunch and has been hit by the worst demand levels in history. Overnight, COVID-19 left planes on the ground, airports abandoned, and brought an industry to its knees with a loss of $84 billion. It slowed down with the cancellation of many international as well as domestic flights all across the globe. The governments made a multitude of adjustments with aids and safety measures to tackle the spread of the virus.

According to the latest data, domestic airlines across the country carried 55.6 million passengers from January to November 2020, nearly 58% lower than what is carried in the same period last year. The emergence of COVID-19 has challenged the comfort and convenience perspective of the passengers to fly. As of May 2020, more than 40 percent of people expressed that they will use air travel less than planned over the next 18 months in the aftermath of the coronavirus pandemic.

2020 saw the collapse of airlines such as Flybe, AirAsia Japan, Jetlines, ExpressJet Airlines. Key companies of the aviation industry that are getting affected globally include Qatar Airways, Emirates, China Eastern Airlines, Lufthansa, Boeing, Airbus, American Airlines Group Inc., and Delta Air Lines. Manufacturers were also badly affected, overall demand dropped by 30% and 50% for Airbus and Boeing respectively. The COVID-19 crisis will have an impact for years, and the market will take years, perhaps a decade, to return to pre-crisis levels.

How will it transform in 2021?

Despite the hurdles of the past year, the Airlines Industry is desperate to further cut costs and raise financing, bringing in a re-thinking of the travel structure. Experts have predicted a 50.4% improvement for the industry in 2021 and air travel is expected to return to 2019 levels in 2023.

Unsurprisingly with the reality check, the coronavirus pandemic will deliver the most significant impact to the industry this year. The global airline industry is likely to experience a net loss of $38.7 billion, higher than that reported during the global financial crisis in 2008. There will be some behavioral changes in travel patterns among the passengers. Financial recovery is expected in the Asia-Pacific region, attributed to large domestic markets in China and India.