When and how will demand for commercial aviation return and who will be there to meet it? The issues facing the aviation industry are discussed in these two attached insight documents from respected consulting groups.
The first document takes a global perspective. The second focusses on issues specific to Australia.
With so many variables and unknowns it would be unwise to attach any figures to projections but these documents do outline some likely outcomes along with the key challenges.
The global in-service fleet has apparently recovered to 76% of pre-Covid levels although there are huge regional differences. For China, who were first to experience and then recover from the outbreak, levels are back up to 99%. Other regions, such as Australia are still dealing with extremely low levels with the industry posting daily losses of $330+ million.
So how and when will this demand start to emerge?
Demand is not expected to be uniform. Business Demand is expected to show the first signs of recovery although this may be somewhat muted as businesses has adapted to working via video conferencing rather than face-to-face. Sustainability has also become a business imperative as businesses are keen to reduce their carbon footprint.
Domestic aviation should also rebound quicker in most regions. Holiday travel will depend on how well regions can contain the virus and vaccine roll-outs. Vaccine passports have been suggested and may gain traction in an attempt to provide confidence to travel and open up gateways.
However, when demand does begin to increase, the demand for pilots may easily surpass supply. As recently as 2019 the industry was reporting challenges in recruiting pilots. Now, many older pilots have opted for retirement, many younger ones have left the industry. New recruits to the industry are deterred by how dependent the career has become on global crisis. First, 9/11, then the 2008 Financial Crash, now the Covid pandemic. It seems, every decade heralds a new crisis that hits career pilots.
So the outlook is complex…find more detailed insight and interpretation at a global level here.
Australia has its own particular circumstances. Domestic travel has basically remained high in places like WA that is sustained by the mining and resources sectors. In other states, ‘the golden triangle’ Melbourne-Sydney- Brisbane is likely to see the return to demand from business travel. Travel corridors have already been established with New Zealand. Leisure travel domestically may be curtailed initially by impacts being felt on household incomes. Australian households have been proportionally harder hit than their counterparts in the US and UK. A return to higher levels of leisure travel are likely to be dependent on worldwide ability to contain the virus. So any return of demand is likely to be in stages rather than an overall rebound – for greater detail about this see the link here….