In just a few short months one of the greatest economic developments since the end of the Second World War has been severely damaged by the coronavirus pandemic. When you think about it air travel made our planet much smaller, created jobs and allowed for people to travel all over our planet.
Airlines are now operating at a minute fraction of their normal capacity and according to Euro News “there were just 350 flights on 29 March over European airspace between 8 am and 12 pm, against more than 2,876 on the equivalent Sunday in 2019”.
In France where there are an estimated 90 million tourists who visit every year Air France has only been operating at 5 percent of its capacity. The European Union (EU) has approved a €7 billion bailout to the airline.
It is not only in France that is suffering. Norwegian Air canceled thousands of flights and laid off 7,500 workers. It also announced that four subsidiaries would file for bankruptcy. In Sweden, SAS also decreased its staff, temporarily laying off 90 percent of its workforce.
Italy’s Alitalia airline has been put under state ownership. Stefano Patuanelli, Minister of Economic Development has announced that “the government would become the sole owner of the company starting in June”. However, it is hopeful that this will be a temporary measure until the economy recovers and “the company can renew its search for a buyer.
Many of the major airlines have received bailouts; however the low-cost airlines have not been so lucky.
The UK’s Flybe collapsed on March 5th and although EasyJet offered to rescue FlyBe customers, they too had to ground their entire fleet on March 31st.
Ryanair had to cut back on their staff on May 1st by 3,000 and Richard Bransons Virgin Atlantic cut four-fifths of their flights in the middle of March. He has asked for emergency credit from the British government for 7.5 million pounds and it is said that he has put up his private Island for collateral to help curtail the losses.
Asia-Pacific vice president at the International Air Transport Association, Conard Clifford says that “governments need to ensure that airlines have sufficient cash flow to tide them over this period”, and for some of the big airlines this seems to be true. However; the International Air Transport Association has stated that global losses could reach $314 billion this year.