Almost the entire world has stopped all activity for several months and it is now time to analyze and measure the adversities that some of the participants in the aeronautical economy will face for some years.
“The travel industry has never faced panic, change, and disruption on this scale”
Due to social distancing there will be fewer tickets available to buy and that will lead to higher prices. As it is happening with bars and restaurants with only 50% of capacity, airlines will probably be forced to do so with a similar rate.
Routes have been reduced and people will not be flying for business and pleasure at least for some time. At the very beginning we might experience a peak price for the majority of routes but as time passes it will decrease until it becomes more balanced and affordable.
Middle seats of some airlines are being left empty until regular schedules are back to normal and with fewer restrictions.
Airlines will begin the so called “new normality” by flying to the cities that normally have the biggest demand and health conditions are best. In words of Alexandre de Juniac (IATA´s CEO), the tickets might increment their price up to 50% depending on the region you are flying to.
A recommendation from IATA saying the increasing need of use of masks in flights is making some of the airlines provide them to their passengers in the departure gates. There are some airlines that leave pilots and flight attendants use masks but they may become compulsory for both crew and passengers in the future.
While in Europe people rarely wear them, in Asia it is a common thing amongst society. Times have changed.
It is important also to have a closer look to refund or cancellation policies as airlines are looking forward to having revenues again and users normally do not look at these kind of policies so carefully.
How is the current state of the business? Let´s take a careful look.
The chart shows the daily number of departures and the Covid-19 cases diagnosed in the world, starting February the 20th.
Some of the noteworthy figures that this chart shows, are that daily departures have dropped 93% in 3 months which has left currently only around 2,000 flights departures.
Tourism and aeronautical businesses go hand in hand and if one suffers, so does the other. In Spain, tourism revenues have fallen 77% in March, according to the banking group UBS. That turns into dramatic when GPD´s tourism in Spain is around 11% (2016).
On July, Spanish air traffic will be reopened. The rest of the European countries will continue to do so gradually until European air traffic is back to “normal”.
Some measures will have to be guaranteed in order to fly safe and convince clients that new regulations meet the safety standards: obligation to clean daily the aircrafts, ensure maximum possible separation between passengers, avoid going to the airport with more than 90 minutes in advance and compulsory the use of a mask for indoor public spaces and outdoors when impossible to keep the safety distance of at least two meters.
All this new era post-covid will surely make enterprises tighten budgets but without reducing safety issues and giving users and clients same quality service as it was before the outbreak. Tough years ahead.
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