The outbreak of COVID-19 is continuing to impact people and countries around the world. The Pandemic and ensuing lockdown have brought the industrial production engine to a halt. This is, without a doubt, the greatest crisis the aviation industry has faced since WW-II.
It seems we are lost in fog and desperately calling for ‘Follow Me’ while trying to figure out what future holds for us.
There is no single right answer to all the question or which is the best strategy or set of tools we can apply to get back on track. If we decide in a flurry, most likely it will be a wrong decision.
In the last few weeks the cost of doing business has changed and has brought immense pressure on economics. Once we understand economics and numbers only then we can make a plan for tomorrow.
Economics provides a well-established foundation for understanding uncertainty and means to predict the probability of events based on fundamental concepts. We will make better decisions, once we move from emotions and heuristics to prediction and probability because then we argue about assumptions and interpretation of data and not about fundamental concepts, thus we move from emotions to numbers and costs. It provides useful clarity for taking business decisions.
Better prediction reduces uncertainty.
The coming days will be dark but be reassured the aviation industry will recover and once again prosper. Aviation is uniquely positioned to help the world economy and overcome seemingly overwhelming challenges ‘Return to Growth’.
What airlines and aviation industry could do take full advantage of a difficult situation (38% decline in air traffic and cut in new aircraft demand by 25%).
- Use this time to get the offices, ground support equipment, testers, rigs, jigs, and aircraft to best shape.
- Move Aircraft C checks ahead slightly so that you have more number of aircraft online.
- Redeploy and right-sizing as the market changes.
- Reconfigure cabin to cater to the shift in demand.
- Be nimble. Sensitize staff and managers for tough times.
- Be adaptive. Network planning has to be a moving target, depending on demand and ever-changing restrictions.
- Travel has become irrelevant as most of the business organizations have moved from meeting in person to an online meeting. We will definitely see a spike in old aircraft retirement. Many of these aircraft may not return to service from storage once travel curbs are lifted.
- We will witness consolidation in the industry with mergers and takeovers. Trained and qualified staff would be always in demand. My suggestion to the entire workforce would be to continue to upgrade and acquire new skills to remain relevant in the ever-changing world.
Impact of disruption is often felt in the most unexpected places.
- Airline which is able to predict shade better would reap rich dividends in market share and revenue.
Only thing Immune to change is change itself.
Let’s prepare ourselves for new economy and world order.
Be safe.
