In 2008, banks were on the front line facing the great economic crisis. In 2020, faced with a pandemic which nails planes on the ground, it is the airlines of the whole world which cry for help and which, for some, will not survive the shock. A sense of fear mixed with travel bans led to a drop in demand and the cancellation of more than 185,000 flights.
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The global situation is " unprecedented" and " no one knows how long it will last and what the impact will be, " said Brendan Sobie, an independent industry analyst based in Singapore. " By the end of May 2020, most airlines in the world will go bankrupt, " market analyst CAPA warned on Monday. The pandemic could reduce the number of passengers worldwide by 20 to 30% over the year compared to 2019, estimates S&P Global Ratings, which envisages a complete catch-up by 2022-2023.
Towards a nationalization of Alitalia?
Faced with these bleak prospects, companies turn to the authorities, hoping to be bailed out, like many banks during the financial crisis of 2008. The American air transport asked for emergency aid of up to 50 billion dollars to the federal government, which would prepare a massive $ 850 billion stimulus package. British companies have reportedly asked the government for more than $ 9 billion in aid. For its part, the Italian government is ready to nationalize the airline Alitalia. According to media reports, Rome has planned a global envelope of 600 million euros for the entire national aviation sector, in which Alitalia represents the lion's share.
Iata, which represents the sector at the international level, also called on the authorities to release all possible aid to allow companies to face " a growing liquidity crisis ". " Over 75% of companies have less than three months of cash to cover their fixed costs, " said chief financial officer Brian Pierce on Tuesday. " If the crisis continues with this intensity we will certainly see a consolidation " of the sector, commented Alexandre de Juniac, director general of the association which brings together 290 airlines.
Such financial aid will not be without controversy, especially among those who, in 2008, had already criticized the vast bank rescue plans. They will not be unanimous with environmentalists who accuse the highly polluting air transport of contributing to climate change. In addition, as a large number of countries are threatened with recession, governments will be forced to decide on the sectors to be helped as a priority.
2 billion losses for European airports
The American air transport has requested emergency aid of up to $ 50 billion from the federal government. In addition, as a large number of countries are threatened with recession, governments will be forced to decide on the sectors to be helped as a priority. " Airlines may be at the top of the list, but almost the entire global industry faces pressures, " said Stephen Innes, a market strategy manager at AxiCorp. The fact remains that air transport is a major economic player and even vital for sectors such as tourism, or for the sales of industry giants such as Boeing, Airbus or Rolls-Royce, which weigh very heavily in world trade.
The aircraft manufacturer Boeing has asked the White House and Congress for help in coping with the Covid-19 pandemic while its European competitor Airbus has suspended production in France and Spain for 4 days. In the meantime, airlines are racing to cut costs: cutting jobs, stopping certain routes, renegotiating supplier contracts and using smaller and cheaper planes are some of the measures taken.
European airports are expected to record 2 billion in revenue losses in the first quarter, according to their organization ACI Europe which is calling for support measures from the European Union. This crisis could lead, in the long term, "to higher prices because companies will try to make up for their losses, " warns Shukor Yusof, an analyst with the Malaysian aeronautical consulting company Endau Analytics.