TECH TALK AVIATION SHOULD NOT WASTE THIS CRISIS BY JOHN PAWLICKI | OPM RESEARCH
AS THE UNFOLDING CORONAVIRUS CRISIS KEEPS SPREADING AROUND THE WORLD TO NEARLY EVERY NOOK AND CRANNY, IT HAS BROUGHT AVIATION DOWN SUBSTANTIALLY. IT WILL TAKE SOME TIME TO RECOVER FINANCIALLY, AND A NUMBER OF AIRLINES, OPERATORS, AND INDUSTRY PLAYERS MAY NOT BE AROUND ONCE THE DUST SETTLES.
Which brings us to a reflective point — how should the industry emerge from this dark period? Should we simply bounce back and pick up where we left off as best as possible? O, does there need to be a period of realignment based upon the need to better secure the world from spreading germs — perhaps fewer flights by which to pollute the air or even a need to accelerate emerging technology to reach the next era of flight? Since there is no central authority to guide any of this, differing tactics will be taken around the world on how to emerge from the near- shutdown of travel due to COVID19. Let’s examine some potential ideas and outcomes.
GOVERNMENTS AND TOURISM Most governments fall into one or two camps regarding aviation and air travel and in some cases both — they either need the travel industry to supply a steady stream of travelers to pump money into their economies to stay solvent, or they need manufacturers of aircraft and parts and related services to generate reliable higher-paying jobs in order maintain their economic base. Both are important to different parts of an economy.
The global travel industry relies on planeloads of people visiting tourist destinations and spending money on tours, fees, dining, etc., so from this aspect, a quick return to the status quo is most important. To many of the world’s destination locations, this is a matter of economic life
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and death. The return to the status quo is not only welcomed here but demanded. The business travel portion of
travel is also quite significant to many cities and airlines, where business people fly to meetings and attend conferences and industry gatherings, which generate even more substantial amounts of expenditures for local economies and create more service jobs. Cities have built convention centers that depend upon such groups to drive employment, tax receipts, and even pay for infrastructure. But the recent climate change
concerns which are causing companies and individuals to reconsider unnecessary travel had already begun to have a slight effect on air travel before COVID 19. Will pleasure and business travel return to pre-COVID19 levels quickly, or take a year or two to rebound, or at all? Many overrun tourist locations had already begun shooing away some visitors (Venice, Italy as one notable example), and this trend has been growing. Limiting visitors to specific locales may only serve to push tourists and meeting organizers to other places. Still, it also may slowly promote conferences and other gatherings to offer more virtual attendance options. The pleasure travel industry will need to find new ways to package and market locales to reluctant travelers.
After most economic downturns in the past, many business entities reduced costs by limiting business travel initially as revenues suffered. With the advancements in video teleconferencing and project
management type software, this downturn may have introduced a new paradigm in how remote personnel connect and interact permanently. This may have far-reaching repercussions. Fewer premium seats sold will hit airlines and private aircraft charters hard and hurt their bottom lines much more than losing leisure travelers not visiting Venice as much. As all readers of this magazine are aware of aircraft travel economics, let’s not belabor this point. Airlines and operators will need
to make economic adjustments to how they operate aircraft and seating configurations unless they plan on having more upper-class seats available for upgrades rather than fare-paying travelers. This will hurt large mainline airlines, which depend upon such income disproportionately more than smaller carriers. For countries that rely upon travel for a large of their GDP, national budgets and per capita incomes will suffer. Civil strife may result in some locations. In order to mitigate some of these after-effects, countries and travel- related businesses need to make adjustments and get creative on how they deal with this. New marketing campaigns? Upgrading infrastructure and creating new enticements to attract tourism? Perhaps a more streamlined travel process to better move people in and out of airports, hotels, tours, etc. with less hassle? The other nationalistic concern
is how to maintain or grow an aerospace manufacturing base which generates considerable tax revenue. OEMs should bounce-back initially, but with a slowdown in new aircraft
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