One of the sectors most afflicted by the coronavirus pandemic, air travel has seen hundreds of airlines rocked after the brutal drop in revenue caused by the closure of thousands of routes.
The outlook in 2020 seemed to suggest that many of them would not reach the end of the year, however, according to CAPA, only about 30 airlines have closed their activities.
“The surprise, in an unimaginably dreadful year, where international capacity fell to around one tenth of its previous level and many domestic operations fared only slightly better, was that so few airlines went out of business,” said the consultancy on Friday.
One of the reasons cited is government or shareholder assistance to keep these carriers alive despite the fact that most of their planes remain on the ground. In addition, the stock market and very low interest rates ended up making it easier for many companies to roll over debt.
Those that failed to remain operational on their own have filed for bankruptcy protection, especially in the US courts. It was there that LATAM, Avianca and Aeromexico secured themselves to renegotiate their debts with creditors.
From the list of 30 airlines that ceased to exist last year, CAPA lists eight companies in the US, the most notable of which are Compass Airlines, TranStates and ExpressJet Airlines, three from Germany and three Canadians.
With a focus on keeping its state-owned airline active, the Argentine government incorporated Austral into Aerolinas Argentinas while LATAM decided to close the branch in the country.
None of the airlines, however, had a large presence in the market, with the exception of Flybe, from the United Kingdom, which had a strong regional presence.
Despite this, CAPA predicts that in 2021 the situation may be different and for the worse: “there are very clear signs that business and corporate travel will be slow to recover, reducing valuable premium paying customer numbers, a vital part of full service airline income “, says the article.
The hope, according to the consultancy, is in mass vaccination, capable of reducing the effects of COVID-19 and enabling a gradual reopening of borders. Until then, it remains to be seen how many airlines will be on the way.
