The three global airline alliances, oneworld, SkyTeam and Star Alliance – which represent almost 60 airlines around the world that contribute to more than half of global airline capacity – are jointly calling on governments and stakeholders to take action to alleviate the unprecedented challenges faced by the global airline industry amid the Covid-19 pandemic.
Supporting the International Air Transport Association’s (IATA) request, the three global airline alliances urge that more regulators consider reducing airport and overflight fees, as well as suspending slot regulations for the northern summer 2020 season, as the airline industry is currently facing extraordinary reductions in passenger demand.
IATA estimates that there will be up to US$113 billion in revenue losses for global passenger airlines – and this does not even take into account the travel restrictions recently imposed by the US and other governments.
Turmoil for the aviation and travel industry
Just this week, easyJet has warned that most of its fleet could be grounded. The firm asserted that while it will continue to operate rescue flights for short periods to repatriate passengers, more cuts are expected. Following this, Tui has cancelled the vast majority of its holidays.
And as 30,000 British tourists have been asked to leave ski resorts in France following closures, airlines will likely face millions more in financial losses, as holidaymakers require immediate repatriation. “The airlines are very quick to ask for help from the government, but this is a massive flow of people which will cost the industry millions. If the government does not step in travel companies will start to fail because the cost of repatriation will be enormous,” said Diane Palumbo, Sales and Marketing Director at SkiWorld.
David Taylor, the Chief Executive of Neilson Holidays, also weighed in: “With the Covid-19 crisis likely to last several months, we are asking the government to consider emergency measures specifically targeted at the travel and leisure sector to deliver immediate relief and help avoid widespread failures.”
And more airlines still are being thrown into uncertainty as travel disruptions and restricts drive a massive fall in flight demand. Budget airline Ryanair expects that the majority of its European fleet will be grounded over the next seven to 10 days, and in countries where they are not grounded, growing restrictions could make flying ‘impractical, if not impossible’.
Virgin Atlantic has asserted that its staff will be asked to take eight weeks of unpaid leave over the next three months in order to help the airline cope during the coronavirus pandemic.
"European aviation faces a precarious future and it is clear that co-ordinated government backing will be required to ensure the industry survives," said easyJet Chief Executive Johan Lundgren.
A global response
Rob Gurney, CEO of oneworld, said: “During such times of difficulty and uncertainty, it is important that the airline industry works even closer with stakeholders to mitigate adverse impacts from the virus and collaborate in areas within our control. Governments must implement the measures they consider necessary to contain the spread of Covid-19, and must be prepared for the widescale economic implications that will result from those measures.”
Also commenting on the enormous financial impact of Covid-19, Star Alliance CEO Jeffrey Goh said: “The unprecedented circumstances triggered by the coronavirus outbreak pose an existential threat not only to the airline industry but more generally to global trade and commerce and social connectivity. As airlines stretch their limits to manage the crisis, it is equally critical for governments and stakeholders to avoid further burdens and step up with measures, as some have, that will ensure the future of the travel industry.”