With most borders still closed and travel restricted, COVID-19 has caused the deepest crisis of all time for the global aviation industry. FIA Connect Aviation Relaunch and Recovery Panel moderator David Stewart, Aviation and Aerospace Partner at Oliver Wyman says clearer information on both restrictions and booking options are essential to recovery as the industry heads towards a “new normal.”

What are the most important aspects, issues or questions which will need to be addressed or answered before we can get people to fly again?

DS: Aside from the long-term solutions such as vaccines and effective track and trace, there are three key areas: legislation, reservation handling and “cleanliness”. Oliver Wyman’s surveys into Traveller Sentiment indicate that a lead driver in passenger decisions to travel is government guidelines. Passengers want information on whether or not they can fly and what are the restrictions and quarantine rules? Clarity of restrictions and destination options is key.

The uncertainty surrounding the handling of bookings also needs to be addressed. If COVID re-peaks in a destination country, will the passenger’s money be secure if cancelled? What if the passenger gets stuck abroad because of COVID? Will their insurance cover this? What are the refund policies with regards to COVID?

Passengers also need to be convinced about airport and aircraft safety related to infection. Have the infection risks been appropriately mitigated by suitable processes and technology around hygiene and cleanliness?

Can you name the key drivers which will boost consumer confidence?

DS: Availability of vaccine and speedy, reliable pre-flight testing are the key drivers, followed by certainty and clarity around refunds and refund policies. Infection risks minimized by in-airport and in-aircraft processes will be of utmost importance.

What are the key issues that the aviation industry will have to address to ensure the recovery from this massive downturn is sustainable?

DS: Oliver Wyman has identified five key challenges and opportunities for ensuring the sustainability of recovery, these are:
1) Establishing appropriately integrated actions and planning between airlines, airports and government
2) Effective communications from across the aviation eco-system (manufacturers, airlines, airports) on actions in place and soon to be in place to minimize/mitigate risk
3) Gaining on-going financial support from governments for their strategic aviation assets
4) Right-sizing its resource and infrastructure footprint to survive the 2-4 year recovery period
5) Attracting back the business traveller

How do you suggest the best way for airlines and manufacturers to respond to the challenges of ever-changing safety guidelines and global travel/border and quarantine restrictions?

DS: Co-operation and communication will be key to responding to these challenges. This will require close co-operation with relevant regulators – airlines and manufacturers should position themselves to be part of the decision, not a recipient.

Minimization of in-airport and in-aircraft infection risk is one of the most important aspects that needs to be addressed to boost passenger confidence. This will require co-operation and co-creation by airlines, OEM and airport for new solutions and innovations.

A number of airlines have shed thousands of jobs and retired parts of their fleets ahead of time. What other actions are airlines likely to take to survive the pandemic?

DS: Airlines will continue to focus on cost reductions or cost deferral across the entirety of their cost base, from IT, maintenance, aircraft lessors to airport fees, and beyond.

Other measures likely to be used by airlines include renegotiation and restructure of aircraft purchase orders, non-renewal of aircraft leases and a revamp of customer value propositions.

Can you give any timescales for recovery in the short and medium term?

DS: Firstly short-haul domestic and regional traffic will recover quicker than long-haul with traffic recovering quicker than yield/revenue. Traffic recovery will also vary dependent on the region

Overall recovery is unlikely to be before 2022, and in long-haul, this may not be until 2023/2024.