THE AVIATION INDUSTRY IN THE FACE OF PANDEMIC

PANDEMIC With worldwide travel restrictions, grounded fleets, social distancing norms, and international panic creating uncertainties cash burn, ticket liabilities, and benched staff, there is a huge question on whether the aviation industry will ever recover from the economic backlash of the pandemic. Mohan Ranganathan (retired pilot, aviation industry safety expert and aviation industry watcher) and Jitendra Bhargava (Former airline executive director, consultant, and aviation industry expert) expressed their views and concern about it. Here’s what they have to say.

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The Global pandemic resulting in severe travel restrictions PANDEMIC of the past few months can cut the industry revenues by $252 billion and the industry probably will suffer a net loss of $39 billion in the second quarter.

According to Mohan Ranganathan, India would take at least a couple of years to go back to 50% of the pre-lockdown condition and that too depends on the number of airlines that survive this severe crisis. Mr. Bhargava questioned that with visas, travel, and airlines not being allowed, the aviation industry is about to face one of the most unprecedented and largest setbacks of all times. Even if flights are permitted, apprehension and panic would forbid people from flying for a long time.

He stated that with such a situation, the reduction in the number of flights would also cause immense losses due to piling lease rentals even when the flights are on the ground as 50% of the flights are taken on lease. This coupled with the salaries of the staff “both men and machines are taking a heavy toll on the aviation industry”, said Mr. Ranganathan.

Another IATA statement projects about 25 million people losing their jobs as a result of the stagnant industry. Revenue losses have been calculated with the estimation of grounding of the fleet for 3 months only. Extension of the worldwide lockdown would cause much more revenue loss than estimated.

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According to Mr. Bhargava, PANDEMIC the concept of social distancing imposed after flights are put back to operation would force flights to fly with just one-third of the capacity. This means that the airlines would have to charge much higher prices for tickets to keep the air services functional. He questions the willingness of people to fly with such surged up prices and anticipates an era where only the elite would afford to fly.

Lastly Mr. Ranganathan said that to prevent the airlines and associated services from going bankrupt, the aviation industry has to give up on its ego. “In a time like this, you need professionals with a clear mind, not bureaucrats who know nothing about aviation.”

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