PPRuNe Forums - View Single Post - Coronavirus Impact on Air Travel
View Single Post
Old 26th Feb 2020, 10:02
  #39 (permalink)  
Join Date: Nov 2008
Location: Permanent Newbie
Posts: 50
Originally Posted by Jetscream 32 View Post
Black Swan:

Pandoras box is fully open and this will probably tip the worlds greatest economies into recession or something close to it, corporates will almost immediately start cancelling flights for employees and if they are all booked on full flex refundable tickets, the airlines that use that money for cash flow and fixed costs in advance on release from BSP or card merchants will quickly start calling in for more investor money or start going bust.

Europe will see a major swing in the profitability of even the richest LCC's and it will happen with such speed that nobody will be able to mitigate against it. Fixed costs of airlines are the killer - banks and lessors are going to be in fear of default and it will change the landscape of airline travel forever I think.

In the days of the Black Death virus, we didn't have Twitter, Facebook and instant media attention that is stoking the fear, the narrative versus flu (which is still the biggest killer) is strong enough as we don't have a vaccine or anything for Covid-19 yet....

As an airline exec, I'd be super focused right now on damage limitation, having the very best lawyers speaking with lessors and pre-briefing all of our staff that we may be forced to suspend operations and what the outcomes of that will mean for shareholders and staff.

This is not going to be a pleasant journey for anyone in aviation in 2020 - hold tight and I pray you all to keep your jobs! Roll the dice!
I think the ecnomic impact could be considerable BUT Govt and Central Banks may take a freeze on loan repayments etc to prevent lots of places folding. Banks foreclosing on lots of businesses like 10 years ago happened because there were others who could buy or pick up the slack. When the whole economy is like that it is a different position.
racedo is offline