01/04/20202 min read

Should We be worried About The Future Of The Airline Industry?

The airline industry is undeniably suffering. Oil shocks, currency changes, occasional accidents and groundings. They were big deals but suddenly, they seem like a very small problem for the industry. Now, the impact of COVID-19 on airlines are pushing the industry into new territory, beyond anyone’s wildest dreams. The crisis is worsening daily and the future of many airlines and the airline industry itself is in question. 

COVID-19 crisis is nothing like SARS 

As COVID-19 tightened its grip on China just 2 months ago, everyone was comparing the impact on airlines to the SARS epidemic of 2003. But this is nothing like SARS. While SARS also came out of China, its impact on aviation was much smaller. Unlike COVID-19, its impact on aviation was much smaller as compared to the COVID-19. SARS spread was not as worldwide and it actually ended quickly. 

Experts could measure a beginning, middle and end with SARS. Now, we are nowhere near doing that with COVID-19. 

It is inevitable that some airlines will cease operating 

Second-guessing the fate of airlines is pure speculation and not particularly useful. However, it seems almost inevitable that some airlines will permanently cease operating. The longer the crisis facing the airline industry, the longer the list of bankrupt airlines will be. 

Not being able to put a timeline on the duration of the crisis is the problem. 

The airline industry is not going to cease existing. But it may be set for a serious shakeout. Familiar airlines will no longer be seen and the airline industry will be re-shaped. It will take years for all airlines to recover, financially. It will be a wild ride, just not in a good way. 

But, should we be worried about the airline industry?

Absolutely not. While the outbreak of COVID-19 will eventually go away, travelling will always stay. 

There are people with businesses in other countries, there are families waiting to be reunited and educations and jobs that have to be resumed. Travelling will go on once the world is open up again, the airline industry would slowly pick up and get back on track.