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Coronavirus impact on aviation industry

Aparajita Banerjee

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Coronavirus outbreak to cost airlines almost $30bn

Airlines stand to lose $29.3bn (£23.7bn) of revenue this year due to the coronavirus outbreak, the global airline industry body has warned.

The International Air Transport Association (IATA) predicts demand for air travel will fall for the first time in more than a decade.

Airlines in China and other parts of the Asia Pacific region are expected to take the vast majority of the impact.

It comes as carriers around the world have been forced to reduce flights.

In total, airlines in the Asia Pacific region are set to see a $27.8bn revenue loss in 2020, while those outside Asia are expected to lose $1.5bn in revenue, IATA has forecast.

Of that figure, IATA predicts that carriers in China are set to lose revenue of $12.8bn in their home market alone.

"Airlines are making difficult decisions to cut capacity and in some cases routes," said IATA's director-general Alexandre de Juniac. "This will be a very tough year for airlines."

However, IATA cautioned it was too early to predict what this expected revenue loss would mean for airlines' profitability this year.

IATA said it had based its estimates on the slump in demand that was seen during the Sars (severe acute respiratory syndrome) outbreak in 2003. That was characterised by a six-month period that saw a sharp fall in demand followed by an equally quick recovery.

That year Sars was responsible for the 5.1% fall in demand for airlines in the Asia-Pacific region.

The forecast also assumes that the virus remains centred on China, but IATA warned the effect could be far worse if the infection spreads further in the region.

IATA has previously forecast that the Asia Pacific region would be the biggest driver of air travel demand between 2015 and 2035, with four of the five fastest-growing markets in terms of passengers being from Asia.

On Thursday, two major airline groups warned of a severe financial impact as a result of the coronavirus hitting demand for travel in Asia.

Australia's Qantas said the outbreak would cost it up to 150m Australian dollars ($99m; £76m), while European carrier Air-France KLM put the cost at up to €200m ($213m; £168m) for the period between February and April.


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12:00 AM, March 12, 2020 / LAST MODIFIED: 05:51 AM, March 12, 2020

Biman braces for a bumpy ride

Incurs Tk 217cr loss in Jan-Mar 28, cancels 198 int’l flights amid coronavirus outbreak

Rashidul Hasan


Biman Bangladesh Airlines is heading towards a serious financial crisis due to the global coronavirus fallout.

The national flag carrier has cancelled at least 198 international flights between January and March 28 due to global outbreak.

The company incurred an estimated loss of Tk 217 crore due to flight cancellations, and reduced cargo operation and ground handling, Mohibul Haque, senior secretary of civil aviation and tourism ministry, told The Daily Star last night.

If the situation does not improve in the coming months, Biman will face difficulties in paying its 4,500 employees, of whom 3,329 are permanent, officials said.

The airlines may have to seek financial assistance from the government, Mohibul said.

Principal Secretary to Prime Minister Sheikh Hasina, Ahmad Kaikaus, on March 10 held a meeting with secretaries of different ministries to discuss how the crisis facing trade and commerce could be tackled, sources said.

"Other organisations may be able to recover their loss caused by the coronavirus outbreak through extra effort. But Biman won't be able to recover from its losses," said a top official of civil aviation ministry.

At present, Biman management will be glad if it can pay the salaries, said the official.

Biman is now trying hard to cut costs, said another ministry official.

Due to Saudi Arabia's ban on umra, Biman has lost several thousand potential passengers who were set to fly to Saudi Arabia.

Uncertainly looms over hajj as well.

Hajj pilgrims are the main source of income for Biman. The company is scheduled to carry around 69,000 pilgrims to Saudi Arabia this year, Biman officials.

Prospective Bangladeshi hajis so far showed lukewarm response to register for hajj, said Hajj Agencies Association of Bangladesh.

Biman Managing Director and CEO Mokabbir Hossain said the airliner has halved its international flights as fewer people are flying due to the global coronavirus outbreak.

The national flag carrier suspended flights to several destinations.

"We have decided to reduce our weekly flights to 68 from 142 on 10 international routes amid the coronavirus outbreak," he said.

Apart from Biman, 12 other airlines operating from Dhaka have also cancelled 98 flights since January, sources at the Hazrat Shahjalal International Airport said.

Different airlines have started operating their flights with smaller aircraft instead of large wide-bodied ones.

As situation gets worse, many airlines reduced their number of regular flights too.

Around 28 airlines used to carry between 20,000 and 25,000 passengers to and from Dhaka airport each day. The number has significantly fallen in the last two months.

There are currently 119,711 confirmed cases and 4,351 deaths from coronavirus.

Global airlines industry may lose $113 billion in sales if the coronavirus continues to spread, according to the International Air Transport Association.

Just two weeks ago, the IATA had been expecting lost sales in the range of $30 billion.

Airlines in Europe and Asia would bear the brunt of the pain, according to the IATA. Carriers in Asia Pacific could lose out on sales worth $58 billion.

If the virus is contained soon, and economies around the world recover quickly, total industry losses could be limited to $63 billion.



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Bangladesh to resume limited-scale int’l flight operation on June 16

Bangladesh has decided to resume international flight operation in a limited scale from June 16 after nearly three months of flight suspension for containing outbreak of COVOD-19 pandemic.

“We will resume Biman Bangladesh Airlines flight on Dhaka-London-Dhaka route and have given permission to Qatar Airways to initially operate three weekly flight on Dhoa-Dhaka-Doha sector in condition of carrying only transit passengers after June 15,” Civil Aviation and Tourism Secretary Mohibul Haque told BSS today.

The senior secretary said the Civil Aviation Authority, Bangladesh (CAAB) has taken all preparations to operate the international flight following the health guideline of International Civil Aviation Organization (ICAO).

“Firstly, we will operate a weekly flight of Biman on London route. If we get enough passengers, we will make it daily gradually as like as the previous regular schedule,” he said.

Haque said the government would like to reestablish air connectivity with the outer world in a limited scale while the country has almost been cut off from the globe as currently flight operation remains open with China only.

He said as per the government decision, all the returnee Bangladeshis would have to be sent to a 14-day institutional quarantine if they fail to show COVID-19 negative certificate at the airport on their arrival here.

Meanwhile, the CAAB issued a circular regarding the decision, saying that airlines must follow its health guideline of ensuring hygiene and social distancing while operating the international flights.

On May 28 the government extended the ongoing suspension on commercial scheduled international flights for seventh time till June 15 to and from Bahrain, Bhutan, Hongkong, India, Kuwait, Malaysia, Maldives, Nepal, Oman, Qatar, Saudi Arabia, Sri Lanka, Singapore, Thailand, Turkey, UAE, and the UK.

From June 1, Bangladesh resumed domestic flight operations after more than two months on a limited scale.

Meanwhile, different countries, including India, the USA, the UK, India, Japan, Canada, Australia, Turkey, Singapore, Malaysia, Thailand, South Korea, Bhutan, Myanmar and different European countries so far operated several special chartered flights amid the flight suspension to repatriate their citizens from here.

Bangladesh government also facilitated chartered flights to bring back its nationals from a number of countries, including India, the USA, the UK, Australia, Singapore, Malaysia, Thailand and Vietnam.

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