Virus pandemic reshaping air travel as carriers struggle

17, Aug 2020 |

Globally, air travel is down more than 85 percent from a year ago, according to industry figures

In a bid to survive, airlines are desperately trying to convince a wary public that measures like mandatory face masks and hospital-grade air filters make sitting in a plane safer than many other indoor settings during the coronavirus pandemic.

It isn’t working.

Surveys indicate that instead of growing comfortable with air travel, more people are becoming skeptical about it. In the United States, airline bookings have stalled in the past month after slowly rising — a reaction to a new surge of reported virus infections.

Globally, air travel is down more than 85 percent from a year ago, according to industry figures.

The implications for the airline industry are grave. Several leading carriers already have filed for bankruptcy protection, and if the hoped-for recovery is delayed much longer, the list will grow. The four largest US airlines lost a combined USD 10 billion from April through June. Their CEOs say they will survive, but they have lowered their expectations for a rebound.

“We were all hoping that by the fall the virus might run its course,” said Southwest Airlines CEO Gary Kelly. “Obviously, that has proven to be dead wrong.”

When Consumer Reports surveyed more than 1,000 people in June about their comfort with various activities during the pandemic, 70 percent said flying was very or somewhat unsafe. They rated going to a hospital emergency room or standing in line to vote as safer.

In a survey commissioned by an airline trade group, the biggest concern of travelers was the possibility of sitting next to an infected person. John Kontak, a schoolteacher from Phoenix, said that was his fear as soon as he stepped onto a crowded American Airlines flight this summer to visit his parents in Ohio. “I don’t know anything about this person who is sitting a foot away from me,” Kontak said. “They took the bottom line or the dollar over the safety of passengers. Next time, I’d rather drive back to Ohio than fly — it’s safer because I can control it.”

An airline trade group, the International Air Transport Association, predicts carriers will lose USD 84 billion this year, making it the worst year in the industry’s history. The group says traffic won’t fully recover until 2024.

Asia, where outbreaks were brought under control earlier, is doing better than the US and Europe. Domestic travel inside China has recovered to about two-thirds its year-ago level. In the US, traffic is less than one-third of 2019 levels.

Air traffic at Europe’s more than 500 airports has tumbled, down 94 percent in June compared with the same month last year. There were about 4 million passengers, compared with 217 million a year earlier.

Travel ticked up when more than two dozen European countries opened borders to one another in early July, but virus cases are rising in several countries, leading to reimposed restrictions. This week, the UK imposed a 14-day quarantine requirement on travelers — even Britons returning home — from France and the Netherlands. Travel from outside Europe, including the United States, is still restricted.

Among international carriers, the big state-backed airlines are almost certain to survive. In Asia and the Middle East, they are often seen as vital contributors to the overall economy. Similarly, big European carriers including Lufthansa, Air France-KLM and British Airways may be too important to let fail.

It’s too late for UK-based Flybe; it shut down in March. Latin America’s two biggest airlines, Avianca and Latam, filed for bankruptcy protection. So did Aeromexico. Virgin Atlantic and Virgin Australia, both part of British mogul Richard Branson’s galaxy of companies, are using the courts to reset debts.

In the US, Trans States and Compass, which flew smaller planes for the major airlines, and Alaska-based Ravn Air shut down, but the big airlines have survived with billions in government aid and billions more in private borrowing.



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