Impact of Covid on Airlines Prt 1

Emirates, Qatar, Lufthansa, British Airways, Etihad Airlines, Qantas, American Airlines, Southwest Airlines, All Nippon, Cathay Pacific, Singapore Airlines, Delta Airlines, KLM, Air France and the list goes on and on. In a nutshell, these are some of the leading airlines worldwide in reputation, and market share. Imagine all their planes parked and suddenly the airspace is quiet, no pollution caused by the rumbling of jet engines while landing or taking off, no signal lights flickering on the screens of air traffic controllers at the airports showing the position of each plane. A long pause it was, that happened, when Corona Virus Disease 2019 (Covid 19) reared up its ugly head.

The silence was deafening, uncertainty filled the air, and it took time to figure out how to cope with the sudden emergence of a deadly airborne disease. Pilots, in-flight attendants, air traffic controllers, aeronautical engineers and all employees of indirectly related businesses to the airline industry were left hapless. The tension was palpable; governments overwhelmed and at a catch twenty two situation. The ordinary citizen was gripped with panic hence made hasty purchases in an attempt to stock up and go through what was going to be an experience of a lifetime.

As the pandemic grew and spread its tentacles far and wide a lot remained at stake; what would be the repercussions of the economic impact on the industry and how long will the lull take? It is a no brainer how movement of people stir up economic growth, with planes parked on runways the inevitable was to happen. Losses running into billions followed, revenue dropped to $419bn, 50% down from 2019 according to the International Air Transport Association, which has a total membership of 290 airlines. 

Days turned to weeks and months; then companies started releasing statements of losses and the need to enforce austerity measures. Top on the list was downsizing, a case in point American and Delta Airlines informed their employees of a planned layoff in October 2020. American Airlines anticipated rendering 19,000 employees jobless while Delta sought to reduce their pilots by 2000 heads. In July, American Airlines warned of a furlough or job redundancy of up to 25,000 workers which was around 20 percent of these. 

News also emanating from United Airlines wasn’t different; they foresaw laying off a staggering 36,000 individuals from October 1 2020. CNBC also noted that, Airline CEOs were prospecting to be overseeing smaller airlines, which would require fewer employees. For the first time in many decades the industry was losing money because of the corona virus pandemic.

A large number of individuals being laid off meant families were staring at a bleak future as their breadwinner’s finances faced imminent depletion whereas in some households, the expected income was halved.  To dismiss these employees came at a cost which the airlines never planned for. It meant companies had to embark on a major restructuring process to steady the finances going into the future and hope to set a precedence of how they will attempt to prepare for such like a scenario in case it re-occurs.

Maintenance costs skyrocketed; planes were not made to be parked but flying while ferrying passengers. In that state, engines tend to accumulate a lot of dust which in the long run affect their operation, and the challenge was to make sure they remain functional. Warnings were given by The Federal Aviation Administration to airlines operating the Boeing 737 New Generation (737 NG); for instance a caution to Kenya Airways (KQ) about a specific part in the engine. Consider (Business Daily Africa) Tuesday, September 8, 2020.

"Operators of the Boeing 737 New Generation aircraft were forced to inspect afresh the engines of the planes after the US aviation regulator warned that they could stall mid-air after being grounded for months. The Federal Aviation Administration (FAA) said the planes that have been idle since the outbreak of the pandemic could form corrosion on the air check valves, an anomaly that can lead to stalling of the two engines when the airplane is flying".