the Global aviation industry will already bears heavy losses due to the pandemic in the early stages, but experts believe that the real crisis is still ahead. As reported by South China Morning Post, according to experts, the capacity reduction can reach 80%, and some companies may face bankruptcy.
as an example, the publication cites the airline of Hong Kong, where the situation is even more aggravated because of the government’s decision to enter home quarantine for all foreigners arriving in the special administrative region of China.
About a possible drop in business of some carriers, 80% stated, in particular, partner at OC&C Strategy Consultants Pascal Martin. Thus, according to the company Cirium engaged in the analysis of aviation industry in China from 1 January to 10 March have canceled more than 500,000 of the 1.11 million scheduled flights, that is, 45%.
“the Impact of the pandemic is enormous,” — said Martin, — “you Can expect to drop by 50-80%, depending on the airline, of the total cost of traffic during those weeks when the airline canceled their flights. And this number is increasing week by week.”
According to information posted on the platform Statista, the direct contribution of travel and tourism in the world’s economic volume in 2019 amounted to slightly less than $2.9 trillion. The total contribution of the industry exceeds $9.2 trillion.
According to Pascal Martin, in the coming months, the losses of the airlines will grow as more countries close the borders.
“for Example, shares of British Airways have lost more than 60 percent of its value last month. By June, if things go better, we will see that airlines will start to recover. But they may not have reached its bottom,” — said the expert.
however, Martin noted that there are positive aspects: how China and South Korea promptly fight infection, as well as work on a vaccine against coronavirus, ongoing in several countries, inspires cautious optimism.
However, while the flash was quenched in one place, the fire could spread to other objects.
“the biggest concern is the fact that in Africa, India and the rest of Asia can begin the third wave… If the virus spreads in these regions, this can lead to a long stop air traffic,” added the analyst.