User:Ruwini Herath/sandbox

The impact that COVID-19 has had on Emirates and the airline industry in general

According to ICAO annual statistics of world air travelling details, at the end of the year 2018, the overall passengers carried were approximately 4.3billion and it was a vast amount of surge comparing to other years. Simultaneously, the total freight traffic in 2018 was 58 million tones. These massive numbers have declined due to this tragedy of COVID-19. In this wiki, I have pointed out the impact of COVID-19 to the airline industry by endorsing with Emirates airlines. Emirates, the largest airline fleet in the world was carrying 2 billion passengers around the world per year (before COVID situation). Every day nearly 150 aircraft were flying through Dubai International Airport. This magnificent airline is facilitated with the world’s largest airline kitchen which is comprised of 21,000 square feet surrounding. It assembles 5550 meal carts per day that leads to 20 million meals per year. This is the scale of Emirates airlines and it has remained one of the best serving airlines in the world. This industry has been seriously affected by the COVID-19 pandemic and that will be affected in the post- COVID era as well. I have identified six major challenges that need to be faced by the airline industry due to COVID-19 pandemic.


 * Workforce involvement

Airlines should consider the balance between automation and human involvement through its operations. They face a challenge of either to retain their employees fully or partially. On the other hand, go to automation. Especially considering Emirates airline’s catering system, they need to prepare 20 million meals per year. Additionally, they need to work on 30 million trays cleaning throughout the year. These chores with high volume in repetitive work. Anyway, Emirates currently working on a half man and half automated workforce. They are aid by electronic power monorails throughout their kitchen floor that spread for 2.55km (WWW.Emirates.com). Due to the pandemic, all the financial figures have challenged and they would consider applying more automation in order to increase the level of operational efficiency and also to meet their customer demand and satisfaction. This means the machine learning or Artificial Intelligence (AI). Because of AI, the airline industry will also consider about to automate their other activities such as Engineering and refuelling as well. Therefore, there will be a decrease in the human fleet of this industry by 50% in near future.
 * Rationalization of routes

In the Emirates fleet, there are 113 Airbus A380 superjumbos and over 150 Boeing 777 aircraft. Due to the pandemic and its rapid transmission they were completely gowned their fleet by March 2020. It has set to become the world’s largest aircraft car parking (Asquith, n.d.) According to this situation, not only Emirates but the entire airline industry losses a huge amount of revenue. In order to overcome this challenge, they need to undergo an analysis of rationalization of their destinations. Typically, an aircraft needs to be filled with 66-70% of their passengers and carriages to make a fleet viable. In order to do so, airlines need to prioritize their major routes and identify the most suitable, cost-efficient aircraft to increase profitability and return on investment of the industry. Moreover, the need to increase safe cargo services rapidly rather than passenger travels during the pandemic period.


 * Consideration of long- haul and short-haul flights

Here the long-haul flights are recognized as flight longer than seven hours and short-haul flights as less than seven-hour flights. According to the demand from passengers, airlines need to make accurate ratios on these two flight schedules. The COVID-19 has already risen to a financial crisis in this particular industry as well as to the entire world. Therefore, the airlines should consider less costly and high revenue flight routes rather than terminating their operations due to the pandemic. For instance, Emirates airlines have started flying A380. Emirates has resumed to five cities. They are Amsterdam, Cairo, London Heathrow and Paris (Goldstein, n.d.) With the recovery speed of this pandemic, it is assumed that short-haul flights will be affected for another three years and long- haul flights could be struggling for another five years times.


 * Green fuels

Airlines are the highest culprit in environmental pollution throughout the entire period of time. This concept has been debating for more than years and recently new innovative aircraft have been introduced to the industry. These are known as green flights which are entitled to sustainable biofuel. For instance, many airlines in Europe and the United States have guaranteed to clean up their environmental act. Delta Airlines have stated that they will invest $1billion over the next decade to on introducing technologies to aid the company to become carbon neutral. Similarly, JetBlue, Air France and British Airways have decided to purchase carbon offsets to reduce the effect from their domestic flights starting in 2020. Others like United Airlines and Virgin have started in biofuels that lower emissions than jet fuels. This attempts will lead the airline industry to clear sky policy in 2050.


 * Introducing new promotions

As this a critical situation, airlines should be innovative through their promotional campaigns in order to overcome the hard times. In the phase of Emirates- skywards, they introduced that expiring passenger’s rewards can carry out for the next year due to COVID-19 pandemic. Similarly, the Qatar airways have facilitated the same promotions through their privileged club, Qatar miles. These proactive promotional activities will encourage their passengers and retain with their fleet and inspire them to fly immediately (within a year) to their desired destinations. According to the article by Michale Goldstein in Forbes, despite the pandemic Emirates have started flying their A380 airlines as I have stated above. Rationally, why do they have taken such as an immense risk? This is basically another promotional movement. They are the first airline to offer free global coverage for potential COVID-19 health expenses (https://www.emirates.com/us/english/help/covid-19/free-covid-19-cover/ ) which is up to 150,000 euros and the expenses of the quarantine period. Moreover, most of the airlines have initiated partnerships with subsidiary services to facilitate their customers. For example; car rentals, hotel and travel services. The travellers would be grateful to have all these services under one roof. It is more convenient and hassle-free rather than searching for them during a hard period like this. These are more effective promotional drives for airlines in order to thrive their businesses to success without drawing back since of this critical pandemic situation. That encourage people to travel from the environment of uncertainty to certainty.
 * Considering on pent-up demand air travels

Pent-up demand in the sense some travellers travel twice or thrice per month whether from their workplace to home town. As a result of this novel COVID virus, the travel restrictions and other healthcare issues have decreased airline travelling. But this particular group is undergoing a hard time. Despite the pandemic situation, currently, the airlines have started their operations at a low level. Therefore, in order to capture and facilitate the demand of these groups, airlines should act positively and timely manner. Considering the gaining of the financial aspect of the airline, they may have the ability to increase the airfare considering the demand. However, meanwhile, most of the air fleet is constantly considering and catering the requirements of pent-up demand groups as soon as possible.


 * Facing challenges from legal factors

At the very beginning of this pandemic period, the airline industry was almost terminated around the entire world. Anyhow the laws and regulations have been the same as usual. For instance, airlines were supposed to travel some of the ghost flights during this pandemic. Ghost flights in the sense, in order to retain and continue their fleet with some of the planned routes, airlines will have to fly with or without passengers. There is a similar regulation enforced by the Federal Aviation Administration (FAA) in the United States. This is not an ethical move during a time of the pandemic. Nevertheless, as reported by Boffey (2020), Brussels has reacted to coronavirus pandemic by suspending the EU’s use-it-or-lose-it routes on airport landing slots, freeing airlines to halt ‘ghost flights’.

On the other hand, airlines are frustrated with additional taxes which are entitled during the recession time of the pandemic. It is mostly about the environmental taxes which are enforced by the international aviation authority. In the first week of March 2020, the Airlines4Europe conference in Brussels has been conducted. According to Plumer and Tabuchi (2020), Air France-KLM has mentioned the virus in calling for Europe countries to delay upcoming policies designed to control air travel and reduce carbon-dioxide emissions. Additionally, Benjamin Smith, the airline’s chief executive has cited that they are asking governments to freeze the introduction of new flight taxes. Yet Annie Petsonk, international counsel for the environmental defence fund has stated that it is true that this is a challenging time for airlines, but that no reason to weaken these rules and take airlines off- course on efforts to address climate change. However, these debates have not been succeeded throughout the session.

References

https://www.icao.int/annual-report-2018/Pages/the-world-of-air-transport-in-2018.aspx Asquith, J. Emirates Airline Suspends All Flights. [online] Forbes. Available at: https://www.forbes.com/sites/jamesasquith/2020/03/22/breaking-emirates-airline-suspends-all-flights/#60176c6c6bd8 [Accessed 20 Oct. 2020]. Goldstein, M. Emirates Flies Airbus A380 Again Despite Pandemic. [online] Forbes. Available at: https://www.forbes.com/sites/michaelgoldstein/2020/08/06/emirates-airbus-a380-jumbo-jets-fly-again-despite-pandemic/#3d8a6c96894e [Accessed 20 Oct. 2020]. Boffey, D. (2020). EU frees airlines to halt ‘ghost flights’ in coronavirus fightback. The Guardian. [online] 10 Mar. Available at: https://www.theguardian.com/business/2020/mar/10/eu-airlines-ghost-flights-coronavirus-fightback-airport-landing-rules-empty-planes.

Plumer, B. and Tabuchi, H. (2020). Coronavirus Could Slow Efforts to Cut Airlines’ Greenhouse Gas Emissions. The New York Times. [online] 6 Mar. Available at: https://www.nytimes.com/2020/03/06/climate/covid-19-climate-change.html?searchResultPosition=4 [Accessed 21 Oct. 2020].