FILE PHOTO: A Flybe plane takes off from Manchester Airport in Manchester, BritainReuters
- The aviation consultant CAPA warned that "most" of the world's airlines could be bankrupt by the end of May, due to the ongoing coronavirus pandemic.
- Although President Donald Trump signed a $58 billion bailout for the airline industry into law on last month, it's possible that it won't be enough — while other airlines around the world remain in jeopardy, particularly as credit markets seize up.
- Several airlines have already collapsed due to COVID-19 outbreak, including in the US and UK, and elsewhere.
- The latest was Virgin Australia, which declared bankrupcy but is continuing to operate.
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Air travel has been one of the hardest-hit industries in the early days of the COVID-19 pandemic.
Almost as soon as news of the virus became widespread in late-January, travel demand to Asia from the rest of the world plummeted. Even before the containment was adopted across the globe, airlines began to drastically cut flights to China, and other locations in Asia as coronavirus-related anxieties led passengers to avoid travel to the region.
Within weeks, however, it became apparent that flights to Asia were not the only routes to see lower demand.
As the virus spread to Europe, followed by the Americas and Africa, passenger demand plummeted across the board. People were second-guessing trips anywhere away from home, and were trying to avoid anything involving air travel, given the inherent close proximity to other people, some of whom could be carrying the virus.
Notably, people were also delaying buying tickets for future travel, due to the uncertainty surrounding the outbreak.
The scale of the carnage for airlines became apparent when British regional airline Flybe ran out of cash and entered administration the first week of March.
While Flybe had ongoing financial difficulties and was already on the brink, the coronavirus situation, and the associated decrease in bookings, served as the final nail in its coffin.
As countries around the world have closed their borders, and many states and nations have locked down, air travel has declined significantly, with airlines suspending routes, grounding planes, and seeing low load factors on their few remaining flights.
While many US airlines would be safe for now thanks to the bailout bill working its way through Congress, several other airlines have already collapsed, and many more around the world are on the brink as the crisis drags on.
Although President Donald Trump has signed the stimulus bill that includes $58 billion in aid for airlines — $29 billion in payroll grants for workers, and $29 billion in loans for the airlines — several airlines have already collapsed. And it is likely that other airlines, both in the US and abroad, will be forced to consolidate or shut down, International Air Transport Association (IATA) director general Alexandre de Juniac has warned.
IATA estimates that airlines globally will lose at least $314 billion due to the outbreak.
Similarly, aviation consultancy CAPA said earlier this month that by the end of May, "most airlines in the world will be bankrupt" without coordinated government and industry intervention.
Here are the airlines that have collapsed, declared bankruptcy, or suspended operations so far:Read the original article on Business Insider