The Aviation Industry has been soaring in recent years and Industry Experts Boeing had forecast over the next 20 years a significant number of newly trained pilots, aircraft maintenance technicians and cabin crew will be required to simply cope with the demand of air transport.
A new virus called the severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2) was identified as the cause of a disease outbreak that began in China with widespread infection by December 2019. The virus is known as Novel Coronavirus 2019 (COVID-19) and in March 2020, the World Health Organization (WHO) COVID-19 announced a global pandemic. The virus itself is highly infectious and can pass in tiny droplets from one person to another. Little was known about the virus itself other than it attacks the respiratory system, the Medical Professionals continue to learn more from the disease daily however, at this time the virus has no known cure.
The Virus has since spread widely across the world which has led to many countries imposing ‘lock down’ on its citizens in order to try and restrict the spread of the virus and to reduce the overall risks to individuals. We all know that COVID-19 is taking a significant human and economic toll. In economic terms, experts predict there is no industry more severely affected than aviation. China, the original epicentre, was the first to ban certain domestic and international travel to prevent the spread of the virus.
The financial implications on the global industry, of the Chinese ban, were relatively limited however, with the virus’ spread to the other big aviation markets in Europe and North America, the situation has really hit home for all. Internationally, travel bans as of late March could represent a reduction in air traffic of up to 98 percent of global passenger revenue – with a three-month blanket ban equivalent to over US$250bn in lost revenue.
Airlines still have financial commitments to meet, such as aircraft rental, hangarage, airport fees and staff salaries, however, with their aircraft grounded, airlines have little if any source of income. To survive airlines and other industry organisations have been forced to cut costs substantially, including making substantial staff redundancies, to remain financially solvent.
Can the industry bounce back?
It is apparent that the Boeing Pilot & Technician Outlook, only commissioned in 2019, hadn’t expected a global pandemic.
Previous epidemics such as SARS also caused a sharp decline in air travel demand, but that followed a v-shaped drop with a quick bounce back. The International Air Transport Association (IATA) predicts the effects of COVID-19 to be much more far-reaching with a slower recovery, as there will inevitably be an economic recession in its wake.
The Aviation Sector will recover, once international travel restrictions are lifted, however industry experts predict it will likely take a minimum 3-5 years before industry returns to pre Covid-19 trade levels.