Six months into the pandemic, it’s even worse for airlines than we thought

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• TAC Analysis is revising downward its forecast for 2020 as recovery stalls well short of previous expectations and worst case scenarios take hold heading into the fall.
• Airline industry awaits the return of the business traveler, which, in turn, awaits the widespread arrival of the vaccine.
• The “business traveler” is not a monolith and represents deeper segmented demographics, each of which will return at varying rates.

For 19 years, marking September 11 is a reminder of painful memories for a nation and a collective trauma for the aviation industry. In 2001 it also signified an indelible turning point for aviation as they were forced overnight to find a new reality after the terror attacks. Now, in 2020, it also represents six months since March 11, the date spread of COVID-19 was declared a global pandemic by the World Health Organization. Dwarfing 9/11, the declaration unofficially marked another industry turning point and the worst crisis the aviation industry has experienced.

Since that first WHO designation on March 11, the world has witnessed half a year of unprecedented air travel decline, optimistic early recovery, and now a concerning plateau as the leisure travel season comes to a close.

Read: As coronavirus pummels air travel, lessons from 9/11 on what may come next

The before and after demarcation of September 11, 2001 is clear. For COVID-19, the industry examines a recovery with the collective understanding that a bottom point is behind us, but what’s clear is that there can be no true recovery until there’s actually an end to the pandemic. 

The initial panic of the spring has long-subsided, but the crisis itself has not yet ended. As the industry continues to grapple with its future form, it is becoming increasingly apparent as we head into fall and winter that estimates for an industry recovery all fall at the low-point of prior forecast possibilities. 

The world’s aviation industry is living the worst case scenario.

With a lifetime of trends experienced in only six months, it becomes difficult for the industry to predict what lies in the years ahead. The business of flying has been reinvented to survive in 2020 and will continue to reinvent itself through the recovery until it ultimately finds its healthy, post-COVID form. Even within that recovery will be the varying segments, recovering at different rates, with the gap between the quicker leisure and slower business recovery playing an increasingly important role.

Read: Fall is here for airlines and business travelers aren’t

Accepting this uncertainty of the coming years, TAC Analysis revisits the decision tree analysis to expand the predictions of possible recovery through 2021. Extending the outlook beyond simple numbers, we focus on the business traveler, and how that critical segment is a collection of further segments, all expected to recover at varying rates.

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