PRESENT AND VOTING
Coronavirus and Airlines
Since its outbreak in March 2020, the Coronavirus pandemic has affected our lives in more ways than we have imagined. Unfortunately, it is still going strong and infecting more people as we speak. One of the many ways that the virus halted our lives is the limited traveling. People had to limit, if not cancel most of their traveling plans to stay safe and healthy. While this action served its purpose to prevent potential mini-outbreaks in many different areas, it really took a toll on transportation companies, airlines the most.
The pandemic affected some airlines more than others, of course. Some airlines which were known and preferred for their customer service and luxury can no longer appropriately provide these aspects of their service. Air travel luxuries such as meals, drinks, amenity kits, headphones, magazines, and pillows can no longer be provided to passengers because of the required safety measures. Passengers are instead being given a snack bag and water during the boarding stage, if anything at all. These reductions inevitably and progressively eliminate the quality difference between budget airlines and full-service airlines. This makes it harder and harder for full-service airlines to compete with the budget airlines’ low fares. (1)
With limited demand for air travel, airlines inevitably experienced huge revenue drops. To balance their budgets, many airlines laid offa significant amount of their staff and cut expenses by cancelling in-flight luxuries like meals. Moreover, they cancelled their aircraft orders and even discarded some aircrafts from their current fleets. The discarded aircrafts are mostly double-decker airplanes, which need a higher number of passengers per flight compared to regular airplanes, to be profitable. Iconic double-decker airplanes such as Boeing’s 747 and Airbus’ A380 have always been a trademark for an airline’s expertise and quality. However, they now represent the dawn of the pre-pandemic era of air travel. With various airlines such as British Airways and Qantas Airlines holding memorial retirement flights as they discard their iconic Boeing 747 airplanes, the new era of air travel continues to rise.
This new era prioritizes fast, small, and fuel-efficient airplanes. Before the COVID-19 outbreak, the general concept of air travel was transporting as many passengers as possible using a single plane, to a hub airport. From the hub, these passengers would scatter for their connection flights which would lead to different destinations. However, due to the pandemic, passengers simply do not want to spend more time in crowded airports anymore, understandably. Due to this reason, airlines started utilizing smaller airplanes with lower passenger capacities and operating costs to keep the revenue loss they face from customer demand decreasing, to a minimum.
Few examples of the different measures that various airlines have taken include American aircraft producer Boeing laying off employees due to the large number of order cancellations, which surpassed the number of new orders in February 2020. Prior to the pandemic, Boeing's business had already been hit by groundings of its new 737-MAX aircraft. By April 7th, Boeing had completely halted all the production at their South Carolina and Washington factories. Having changed its business plans and future vision, it announced their new plan to lay off 12.000 employees, while reporting no new orders in April 2020. Despite all of its negative consequences, the pandemic provided Boeing the much-needed time to conclude its fixes on its grounded 737-MAX aircraft, which is expected to be back to air soon. Another aircraft manufacturer, Airbus announced a net loss of €1.9 billion in the first half of 2020, which equals a 39% loss in revenue, after aircraft delivery halved as a result of the pandemic. Following, the second quarter of 2020 was the hardest hit for the company as Airbus chief executive Guillaume Faury stated "The impact of the Covid-19 pandemic on our financials is now very visible in the second quarter, with commercial aircraft deliveries down 50% compared to a year ago". (2)
After all, many major airline companies as well as smaller ones faced and still continue to face a great deal of challenges because of the pandemic. As they are making different decisions left and right to keep profiting, they are having to lay off many employees which increases unemployment rates as well. However, every airline is a business in its own particular way and they are doing whatever it takes to keep their business alive and in progress, just like many other companies are doing at the moment; hoping to come out of this pandemic with the least damage possible.
by Şebnem YAREN & Kaan ERTAN