Who will survive this and be here in 6 months ?
Yes but the creditors (banks etc) will take a huge hit and may go bust themselves, what with everything else that is going on
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It is a bit childish (not insulting any of you particularly) to think, that after a crisis like this was over (hopefully in about 3-6 month time) on the following Monday we'll all just go back to work like nothing's happened. It is a mistake to imagine, that pumping X billions of FIAT confetti into failing private firms, would make a difference. Companies will disappear, people will suffer. Then we'll still end up with the interest payments to private central banks on trillions of confetti printed by them. I fail to see how the survival of current airlines (and air travel in general) becomes priority in the near term.
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It is a bit childish (not insulting any of you particularly) to think, that after a crisis like this was over (hopefully in about 3-6 month time) on the following Monday we'll all just go back to work like nothing's happened. It is a mistake to imagine, that pumping X billions of FIAT confetti into failing private firms, would make a difference. Companies will disappear, people will suffer. Then we'll still end up with the interest payments to private central banks on trillions of confetti printed by them. I fail to see how the survival of current airlines (and air travel in general) becomes priority in the near term.
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I honestly think the entire air transport industry is in a lot of trouble. If this takes too long and current limitations stay in place, demand for air travel could be down to the level of the 1960's. No one will want to buy any aircraft or hire any crew left over after any airline going bankrupt. This will also mean that no one will buy any new planes, because we have several hundreds standing around not being used, basically available for free.
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A chap further up makes a point about Covid killing mostly older folk. This is true, and this itself will have a profound impact on certain parts of the market. Partly from a smaller market, partly a greater fear. Cruises, key amongst that age group, killed off. There goes a wedge of traffic. Florida, Arizona, Vegas etc, suddenly the sunbirds from the north aren’t coming. Benidorm, Costa del Sol etc. Could also fatally undermine tour operators who tend to have older demographic
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Survival
We all agree that this is the Mother of all Crises for the global economy and especially for all travel related businesses. The question of this post is about survival. Governments will save what must be saved to allow the economy to bounce back. This means that we will have to go back to nationalised airlines. No country can survive and prosper without a national carrier that can cover business essential routes, including cargo etc but also unprofitable routes must be covered e.g. domestically. Capitalism is much better than anything else however it is still not perfect in its present form and this virus will prove it. It is still the best system available to us however it can be greatly improved and it will be certainly enhanced after the virus has ended. The standard rules of capitalism cannot be applied during this crisis. We cannot end up with millions of unemployed and a very high % of companies going bankrupt. It would mean social unrest which will not be allowed on this occasion.
Last edited by ILS27LEFT; 22nd Mar 2020 at 22:42.
Surely this crisis is the start of a golden age in aviation and global transport.
After this experience, no government is going to accept the current slipshod health system, the downside is just too high.
So I expect really effective viral health monitoring and countermeasures to become the norm. That will drag the other health and customs systems with it
With luck, we might be able to return to the pre WW1 era when passports were unheard of. and people could go anywhere as the spirit moved them.
After this experience, no government is going to accept the current slipshod health system, the downside is just too high.
So I expect really effective viral health monitoring and countermeasures to become the norm. That will drag the other health and customs systems with it
With luck, we might be able to return to the pre WW1 era when passports were unheard of. and people could go anywhere as the spirit moved them.
A chap further up makes a point about Covid killing mostly older folk. This is true, and this itself will have a profound impact on certain parts of the market. Partly from a smaller market, partly a greater fear. Cruises, key amongst that age group, killed off. There goes a wedge of traffic. Florida, Arizona, Vegas etc, suddenly the sunbirds from the north aren’t coming. Benidorm, Costa del Sol etc. Could also fatally undermine tour operators who tend to have older demographic
I'm tipping that when the dust finally settles, only a handful of mega airlines will remain. These will either have been nationalized, backed by middle east oil money, or resultant from take-overs and mergers. Some countries unable to afford their own national carrier will have to put pride and political differences aside and form alliances with like-minded neighbours to perhaps run one airline owned jointly by several governments.
Those countries which provide aid to poorer nations would do well to insist no aid money goes towards propping up unviable small airlines. Let them fail.
Would such mega airlines be efficient or profitable? Probably not - history tells us large aviation enterprises often do not run well because of infighting, bickering boards, bloated management structures, cronyism, corruption etc. But they will still be better placed to withstand losses than the public/private sector. Many investors have already lost their appetite for airlines, with more about to cut their losses and run.
Those countries which provide aid to poorer nations would do well to insist no aid money goes towards propping up unviable small airlines. Let them fail.
Would such mega airlines be efficient or profitable? Probably not - history tells us large aviation enterprises often do not run well because of infighting, bickering boards, bloated management structures, cronyism, corruption etc. But they will still be better placed to withstand losses than the public/private sector. Many investors have already lost their appetite for airlines, with more about to cut their losses and run.
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I do tend to think that as and when restrictions are lifted, in the UK at least people will still want to go on holiday. It may well be though that travel habits go back to the old fashioned two weeks bucket and spade in the summer. That may bode well for the likes of TUI and Jet2.
The issue is not who, or what will survive, but what will the world look like after the pandemic. Within this we should consider what aviation might be required or be able to contribute, and with what expectation of how this would be achieved.
To varying extent there were preparations for this pandemic; these are being been severely tested, a stress test for the next one or similar.
So what is next, what do we have to be prepared for on a global level. Climate change is on the list, are we ready; floods, heat, starvation, and more pandemic.
The demands on aviation will be dictated by economics. People will still like to travel, but will they be able to afford it; will nations be able to afford aviation even if there is need. The situation post WW2 involved a lengthy period of recovery resulting in a very different world. The post pandemic world is unlikely to be of the same form or magnitude of change as post war, but it will be changed; to what, why, and when.
In considering when, the effect of climate change opposed to pandemic, is foreseeable, and as a defined point in time establishes a window for recovery post pandemic. This is not very long, and with weakened economic capacity to respond the most significant issue could be how individuals respond; and whatever the viewpoint is today, it will not be the same in six months.
To varying extent there were preparations for this pandemic; these are being been severely tested, a stress test for the next one or similar.
So what is next, what do we have to be prepared for on a global level. Climate change is on the list, are we ready; floods, heat, starvation, and more pandemic.
The demands on aviation will be dictated by economics. People will still like to travel, but will they be able to afford it; will nations be able to afford aviation even if there is need. The situation post WW2 involved a lengthy period of recovery resulting in a very different world. The post pandemic world is unlikely to be of the same form or magnitude of change as post war, but it will be changed; to what, why, and when.
In considering when, the effect of climate change opposed to pandemic, is foreseeable, and as a defined point in time establishes a window for recovery post pandemic. This is not very long, and with weakened economic capacity to respond the most significant issue could be how individuals respond; and whatever the viewpoint is today, it will not be the same in six months.
After WW2 there was a boom in civil aviation, there will be another one as we come out of this. However it will be starting off a low base and it will take years to get back to 2019 levels.
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Ummmmmmmmmmm
AA/ This is going to go on for a long, long time. It will not be over in 3 months. 1 year absolute minimum I think.
BB/ Until some form of practical vaccine is brought into widespread use its just going to get worse unless we adopt the Chinese approach of total shutdown.
CC/ The age of mass travel on the scale that was in place prior to this virus will not return for a very long time. If ever (I very much doubt it will). This is for a vast number of reasons not least off which is the global economic depression that will bite and bite very hard. People will be concentrating on food and shelter.
DD/ Once this is sorted we must address our complete economic and political approach to everything.
EE/ My goodness we need some leadership, especially in the UK. It will not come from our current PM Dominic Cummings nor from a 93 year old Head of State who along with her family has no idea of life in the real world.
FF/ I admit to some panic buying, two lovely bottles of malt whisky which I shall enjoy whilst I catch up on my reading and write my about my experiences over 33 years in the business which I doubt will see the light of day which is probably just as well.
GG/ Unless we get some strong leadership and proper organisation very soon. I dread the consequences that will follow!
BB/ Until some form of practical vaccine is brought into widespread use its just going to get worse unless we adopt the Chinese approach of total shutdown.
CC/ The age of mass travel on the scale that was in place prior to this virus will not return for a very long time. If ever (I very much doubt it will). This is for a vast number of reasons not least off which is the global economic depression that will bite and bite very hard. People will be concentrating on food and shelter.
DD/ Once this is sorted we must address our complete economic and political approach to everything.
EE/ My goodness we need some leadership, especially in the UK. It will not come from our current PM Dominic Cummings nor from a 93 year old Head of State who along with her family has no idea of life in the real world.
FF/ I admit to some panic buying, two lovely bottles of malt whisky which I shall enjoy whilst I catch up on my reading and write my about my experiences over 33 years in the business which I doubt will see the light of day which is probably just as well.
GG/ Unless we get some strong leadership and proper organisation very soon. I dread the consequences that will follow!
We all agree that this is the Mother of all Crises for the global economy and especially for all travel related businesses. The question of this post is about survival. Governments will save what must be saved to allow the economy to bounce back. This means that we will have to go back to nationalised airlines. No country can survive and prosper without a national carrier that can cover business essential routes, including cargo etc but also unprofitable routes must be covered e.g. domestically.
BAA got sold off, then that got forced to sell off by the competition regs, how many of these UK airports will survive this with no money coming in from Duty Free or landings fees etc.,etc....??
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Yes airports as well...
Not just airlines..........I think that will have to carry over to the airports as well.
BAA got sold off, then that got forced to sell off by the competition regs, how many of these UK airports will survive this with no money coming in from Duty Free or landings fees etc.,etc....??
BAA got sold off, then that got forced to sell off by the competition regs, how many of these UK airports will survive this with no money coming in from Duty Free or landings fees etc.,etc....??
Luckily governments can nowadays generate instantly unlimited quantities of electronic money (QE) which is a huge advantage. The old risk associated to printing money vs higher inflation is also obsolete. We will be fine only because of Governments injecting unlimited cash into the system. The Internet is a factor as we now basically live in an E-Money society. If this happened before the web we would be in trouble, both due to the time needed to print in large quantities but especially huge difficulties in distributing the cash during a pandemic. E-Money huge advantage thanks to the web.Nearly all travel related businesses will be saved by Governments, but then also the rest of the economic system will be saved, including other sectors beyond travel as this is a tsunami that is already in the history books.
The rebound will be the Mother of all the rebounds especially if there will be a vaccine or widespread immunity which will happen eventually, I am confident the rebound will be massive and much quicker than what we think now, this will be true especially if the virus will be stopped through new measures including new anti viral treatments and then finally a vaccine.
QE seems easy now: Governments cannot do QE constantly otherwise we will all stop going to work and societies will collapse however unlimited QE is the only option during a war and this is certainly a global war with no other solution.
Last edited by ILS27LEFT; 23rd Mar 2020 at 14:46.
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But isn't that always the way?. In WW2 we started off with Chamberlain who many thought was insipidly useless, then we moved on to Churchill that many held the opinion was a warmongering drunkard, then in the 70's we had Sunny Jim Callaghan (Crisis? - what Crisis?), in the 80's we had strong leadership from the Iron Lady and half the country hated her!.
Have we every had credible effective leadership in a crisis?