By: Air Traveller PH Staff
It was never in our wildest imagination that this Coronavirus outbreak would bring the global airline industry would into a grinding halt. Almost all global airlines have cut their capacity by at least 90% and some airlines suspended operations due to the huge plummet in air travel demand as more countries imposed travel bans and restrictions to stop the spread of CoviD-19.
The International Air Transport Association estimates that the whole industry will lose around $252 billion in revenue in which it describes as the deepest crisis the whole aviation industry ever faced. And it all happened in a time when the industry was seen to even enjoy a higher demand growth.
The whole crisis is also costing airlines billions in costs wherein the IATA thinks that almost half the world's airlines can go bankrupt in a few weeks time if governments do not do anything to provide assistance. It is the first time that the whole airline industry was brought to its knees.
We are however positive that this CoviD-19 crisis will come to an end and everything will be back to normal again. However, expect huge changes in the airline industry which may range from business model change to fleet demand, to airline operations.
In a time when travel bans and restrictions have become a solution to avert a crisis, airlines will now be working on ways and means to cushion the blow in the event of another similar incident in the future. Here are some changes in the airline industry that we foresee:
We also see the slow demise of "First Class" cabin and the emergence of "Premium Economy" class. Many airlines presently serving the Asian market are now adding Premium Economy into their product offering.
Airlines will now basically come up with plans, measures, and changes to make themselves "bulletproof" in the event of a similar crisis like this CoviD-19 in the future. When we say "bulletproof" it means that the blow or loses on airlines will not be as big as this present one.
We however expect that airlines will be more profitable after all these due to streamlining of operations, stronger marketing, and new business strategies in managing costs. The name of the game may now move from "service" to "cost and revenue".
Again these are just our predictions. We are not confirming nor denying any of these.