Paul Maynard is the MP for Blackpool North & Cleveleys and a former transport minister. Tim Alderslade is CEO of Airlines UK.
The news that airlines and airports are now starting to cease operations – temporarily – is of no surprise to those who have followed the truly unprecedented scale of the impact of COVID-19 on the global aviation sector.
Comparisons with the devastation brought on the industry in the days following 9/11 have sadly proven incorrect. This time it is far, far worse.
Global demand for aviation has – like many sectors – totally collapsed, and here in the UK airports are virtual ghost towns, with passengers approaching near zero. Global airline association IATA is now reporting that the economic impact of the pandemic has more than doubled, with industry passenger revenues expected to fall globally by $252 billion, or 44 per cent below 2019 revenues.
UK airlines look set to see the biggest revenue hit in Europe as a result of the crisis, equivalent to £18bn this year, with over 113m fewer passenger journeys. That’s nearly double the impact on French airlines, and is considerably more than the damage being done to aviation in Germany or even Italy and Spain.
This is not surprising when you consider that the UK is an aviation nation, an island economy with the third largest aviation market in the world – behind only China and the United States. It is also home to some of the most well-known airlines and aerospace companies that service that demand.
Just weeks ago, the idea of successful airlines halting services would have been the stuff of fantasy. Instead, it is now the sad reality with UK airlines – big and small – experiencing the greatest challenge to their existence since the boom in air travel began nearly 40 years ago. We must remember this revolution has given millions of people across the country the opportunity to trade, take a family holiday, or see friends and family anywhere in the world, adding huge value to the UK economy in the process.
Yes, airlines must do their part to secure their own futures with the resources available to them. That is why planes are being grounded and costs cut wherever possible. Investors are doing everything they can to support the effort. Meanwhile, carriers are continuing the process of repatriating thousands of Brits stranded overseas and desperate to come home to the UK and their families. This will continue over the coming weeks.
The sector also welcomed the cross-economy measures that have been announced to date which will make a real difference, in particular on wages. However, these measures are, sadly, unlikely to be enough if our ultimate goal is to maintain the UK’s status as a world-class aviation hub, in pole position to support a robust UK-wide economic recovery once we get through the crisis. The scale of the impact is simply too great and the unique nature of running an airline too pronounced.
This has been recognised by dozens of MPs whose constituents rely upon UK aviation and the 1.6 million jobs the sector supports, who have written to the Chancellor urging him to back further industry-wide measures, including temporary cost alleviation on a range of taxes and charges paid by airlines, including Air Passenger Duty and ATC and Civil Aviation Authority charges, as well as steps to reduce the short-term burden of regulation. These measures would both make a material difference to balance sheets now and help to stimulate passenger demand during the future recovery.
To date, the Government has shown considerable willingness to think outside the box during these exceptional times to do whatever it takes to protect UK businesses, from all sectors. For the sake of our world-leading aviation industry, it mustn’t stop this process now.