Airline chief executives say that for all intents and purposes the coronavirus pandemic that brought the industry to a near stand-still in 2020 has been conquered.
Vaccination campaigns, in addition to restrictions on movement, have helped tamp down the spread of the virus across borders, and without state support, the industry would not be able to celebrate the milestone, the executives said at IATA’s World Air Transport Summit in Boston on 4 October.
“The pandemic is in the rear-view mirror for us,” United Airlines chief executive Scott Kirby says. “We’re moving forward.”
United, which was the first US passenger carrier to mandate vaccination for all employees, says 99.7% of its US-based staff has complied with that requirement. Those who did not are in the process of leaving the company.
Other airline executives concurred.
“In the medium to long term, I can see an end to [the pandemic],” Emirates Airline president Tim Clark says. “Probably by the end of next year and certainly into 2023 this will all be history” unless there is another, more-deadly variant.
The all-important business travel segment will ”come bouncing back by the end of next year and be very, very strong in 23, 24 and 25”, he adds.
“In the meantime, we’ve got to just tough it out and work through all the protocols that have been thrown at us by the countries we fly to, and in the end, even that will go,” Clark says.
But as passenger carriers around the world flee forward, executives stress the importance of learning lessons from the crisis, including avoiding a repeat.
When the first detected cases of Covid-19 arrived in Europe in February 2020, the pandemic had already silently spread around the globe, complicating the response that had been standard for rapidly-transmissible diseases to date.
“The Pandemic 101 playbook is to close the borders,” Kirby says. “What was different here for people to wrap their heads around – this pandemic was already everywhere, and there was no keeping it out of your country because it had already spread,” he says.
TRAVEL VILIFIED
As a result of the border closures, lockdowns and other restrictions on movement designed to mitigate further spread of the highly contagious, and for the most part still-unknown virus, the aviation industry was blamed for its global tear.
“It’s unfortunate that travel was vilified,” says Aer Lingus chief executive Lynne Embleton. “There was a period during the early stages of this Covid crisis when being in the travel industry was something you had to defend.”
In the beginning, governments were “groping in the dark”, Kirby adds, searching for the right reaction to an as-yet unknown pathogen. The first question was whether governments would step in with financial aid to keep the air transport industry liquid, and if so, with how much.
“If it had not been for state intervention in many cases, the fact is that most of the airlines in this room would be bankrupt today,” Clark adds. “We have to recognise that, had it not been for our ability to go to the debt markets [and] get equity, we would probably not be having this conference today.”
In the USA, the government’s initial $58 billion infusion of grants and loans kept the lights on, and the aircraft in the air. Kirby says United sometimes flew routes with just a handful of passengers – medical workers travelling to help in the most-critical regions – and with a belly full of lifesaving cargo such as personal protective equipment, ventilators or oxygen bottles.
In Germany, the government also reacted quickly to prop up Lufthansa in the face of a precipitous decline in revenue. Germany’s Economic Stabilisation Fund (WSF) took a one-fifth stake in Lufthansa in June 2020 as part of €6 billion ($7 billion) in support measures to help counter the impact of the pandemic.
That included €5.7 billion as a silent contribution to the carrier and €300 million through the acquisition of the 20% stake.
A few weeks ago WSF said it would begin selling its stake, two years earlier than had been expected.
“The government made some nice money with us,” Lufthansa’s chief executive Carsten Spohr says. “The taxpayers are happy, I’m happy, everyone’s happy.”
Only through the crisis did governments, and individuals, realise how integral air transport is to the modern world.
“What’s happened in the last few months, if anything, is that people understand more than ever now just how important aviation is because they’ve seen what it’s like to not have it,” Aer Lingus’ Embleton says.
“Our industry was supported around the world, and that showed the world the importance of our industry,” Spohr adds. “We would rather not have had the Covid, but we can also take that as a compliment.”
