Editorial | Airlines badly need a lift as industry dives
- With the coronavirus crisis taking a heavy toll on carriers, the authorities must be ready to come to the rescue with subsidies, tax breaks and cuts in charges
The message from health experts that the best way to contain the coronavirus pandemic is to cancel or postpone unnecessary travel has major implications for some of the world’s biggest industries.
Among the hardest hit are airlines, which operate on tight profit margins and depend on a steady stream of passengers for business. With governments having restricted flights through closing borders or imposing long quarantine requirements, traffic has all but dried up.
Some carriers are better able to weather the turmoil than others, but all, and the millions who rely on them for jobs, need the help of authorities and airport operators to ensure a smooth landing.
IATA, the International Air Transport Association, estimates that the economic fallout for the global industry after measures taken by the United States to restrict air travel from Europe could exceed US$130 billion. That is more than three times the impact of the September 11 attacks on the United States.
One British carrier, Flybe, has already gone bankrupt, while Norwegian Air said it had just weeks to avert collapse. Other airlines are dramatically reducing capacity, slashing jobs or, like Cathay Pacific, forcing staff to take unpaid leave or work fewer hours.