Expect Airlines to Supply Fewer Options and Higher Fares After COVID-19

Airline traffic has dropped and may not be good at any time. Approved last week.
The 50 billion aeronautics bailout will save the aircraft in business and
representatives for the following a half year. Nevertheless, the airline executives
suggested that they would be demanding for fewer flights and air travel.

United CEO Oscar Manoj and President Scott Kirby said in a message to their
employees last Friday, "If recovery is as slow as we are afraid, it means our airline
and our workforce are smaller than today. Hundreds of planes will almost certainly
remain grounded, which means less space and more fares.

The low-cost seats that travelers enjoy booking will disappear. Airlines, flight times,
and flights to available routes and markets will have less choice. All this means that
travelers will pay more when they return to the air. Fewer seats mean fewer cheaper
seats on the margins," said Philip Begley, airline chief credit analyst for S&P Global.

A long time to recover lost traffic

This is not the first time the airline industry has had to compromise in response to a
sudden shock. Before the 9/11 terrorist attacks, there were nine major US airlines.
Today, most of these nine airlines – famous carriers like Continental, Northwest, and
US Airways – will merge into four remaining major carriers – the US, United, Delta and
the Southwest.

The four major companies controlled 80 percent of the passenger airlines' passenger
flights last year. The rest of the market offers cheap carriers, such as Spirits, Jet Blue
and Elegant. The presence of these carriers is helpful in keeping some of the larger
carrier seats available at a lower cost.

But today almost no one is flying. The number of passengers entering TSA screening
points in 2019 decreased 93% between Tuesday and the last Tuesday of March. Even
after the corona-virus is in control and more people can fly again, it will take a long
time to recover passenger traffic. Traffic was finally restored in 2004 after the
terrorist attacks in 2001.

Less choices for passengers

The Corona virus crisis is far more severe in the industry than in the past, and there
may be a new era of mergers and airline failures that the industry has gone through
in the past.

Nearby, we are seeing an upsurge," said Joe Schutterman, a transportation expert
and professor at DePaul University in Chicago. "Weak players will most likely be
unable to endure. Most industry pioneers are anticipating a long and agonizing
recuperation.

Even if all existing US airlines manage to survive, big and small airlines will be left
behind by markets and routes that have become inactive in the new environment.
Even on the routes they maintain, they will reduce the frequency of flights to fill
more seats. This will lead to higher rents than before the crisis.

Its also possible that the upside, the low-rent carrier may fail and the larger carrier
can swallow it. At the very least, they may have to leave their less profitable markets.
But it is virtually certain that passengers will have fewer choices, even if none of the
airlines merges or goes out of business, as airlines have new, less traffic with smaller
jobs for the future. Responds to the environment.

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