![]() View here The call: Revisit flight economicsĪirlines should reevaluate the economics of their operations, especially long-haul flights. Therefore, we expect that as the pandemic subsides, the rise in leisure trips will outpace the recovery of business travel. Not only did business trips take four years to return to precrisis levels after the attacks on the World Trade Center but they also had not yet recovered to pre-financial-crisis levels when COVID-19 broke out in 2020. In previous crises, leisure trips or visits to friends and relatives tended to rebound first, as was the case in the United Kingdom following 9/11 and the global financial crisis (Exhibit 1). Remote work and other flexible working arrangements are likely to remain in some form postpandemic and people will take fewer corporate trips. Leisure trips will fuel the recoveryīusiness travel will take longer to recover, and even then, we estimate it will only likely recover to around 80 percent of prepandemic levels by 2024. By responding to these shifts decisively now, carriers should be able to look beyond the pandemic and adapt to the long-term realities of COVID-19. For each of these shifts, we also issue a call to action. This article will explore five fundamental shifts in the aviation industry that have arisen from the pandemic. ![]() Unlike the 2008 global financial crisis, which was purely economic and weakened spending power, COVID-19 has changed consumer behavior-and the airline sector-irrevocably. Other effects, though, are more profound. Mobile apps will be used to store travelers’ vaccine certificates and COVID-19 test results. Some of these are obvious: hygiene and safety standards will be more stringent, and digitalization will continue to transform the travel experience. The sector is expected to be smaller for years to come we project traffic won’t return to 2019 levels before 2024.įinancial woes aside, the pandemic’s longer-term effects on aviation are emerging. In nominal terms, that’s the same as in 2000. In 2020, industry revenues totaled $328 billion, around 40 percent of the previous year’s. It’s difficult to overstate just how much the COVID-19 pandemic has devastated airlines.
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