COVID-19 and Airline Performance in the Asia Pacific region

Abstract

Health risks associated with coronavirus disease 2019 (COVID-19) have severely affected the financial stability of airline companies globally. Recapturing financial stability following this crisis depends heavily on these companies’ ability to attain efficient and productive operations. This study uses several empirical approaches to examine key factors contributing to carriers sustaining high productivity prior to, during and after a major recession. Findings suggest, regardless of economic conditions, that social distancing which requires airline companies in the Asia Pacific region to fly with a significant percentage of unfilled seats weakens the performance of those companies. Furthermore, efficient operations do not guarantee the avoidance of productivity declines, especially during a recession.

COVID-19 pandemic and air transportation: Successfully navigating the paper hurricane

“…In the long run, the impact of COVID-19 on the global air transport system seems to be more profound on the international market ( Sun et al, 2020b ). Such a shift from international to domestic transportation brings challenges to airlines, particularly regarding aircraft usage, which can make the aircraft fleet a decisive factor for airline survival ( Peoples et al, 2020 ; da Silveira Pereira and Soares de Mello, 2021 ). Other notable examples for reactions of countries are those of Germany and Great Britain, who apparently enforced the resumption of international flights, through their flagship carriers Lufthansa and British Airways.…”

“…There are also societal challenges, which will impact aviation in the long run, e.g., stay-at-home telecommunication vs. personal travel, crowd-reduction in public (and transportation systems), and the development of connected and automated vehicles ( Hendrickson and Rilett, 2020 ). Similarly, it can be anticipated that the customer protection rules will be adapted, given the experiences with airlines during COVID-19 ( Truxal, 2020 ; Peoples et al., 2020 ). Another major challenge with very high potential is to design a sustainable aviation future ( Amankwah-Amoah, 2020 ; Ioannides and Gyimothy, 2020 ; Niewiadomski, 2020 ); for instance, aiming for greener, environment-friendly transportation.…”

A study on airlines’ responses and customer satisfaction during the COVID-19 pandemic

“…The air transport industry also faces increasing market pressure brought about by the increased availability of Internet connections. The connectivity established by video conferencing does not pose health risks associated with passenger transportation ( Peoples et al, 2020 ).…”

Economic Impact of Covid-19 on the European Airline Industry

“…According to Budd et al (2020) who investigated the responses to COVID-19 challenges of the airline companies in the period March-May 2020, most commonly the operators attempt to protect their profitability harmed due to enormous flights detraction through modifying their flight operations, staff rationalization and networks reshaping. Assessing the impact of health related upsets on financial performance of airlines in Asia Pacific region, Peoples et al (2020) suggest that the examined companies are predicted to face enormous challenges to preserve their profitability throughout COVID-19 crisis period. Namely, an effective usage of local workforce, fares increase and creation of unions with other operators may be a good approach towards cutting costs, boosting productivity and having their before the crisis performance back.…”