Your weekly travel and aviation Quote-a

17 April, 2020

The Blue Swan Daily brings you a roundup of the most thought-provoking and interesting comments from those industry leaders in the know.

IATA: Recovery from the coronavirus pandemic will be slower than previously expected

IATA director general and CEO Alexandre de Juniac said the airline industry recovery from the coronavirus pandemic will be slower than it previously expected, as the crisis is "deeper than we expected even one month ago" (Reuters, 14-Apr-2020).

Ryanair CEO: Regulations blocking middle seats will 'have no beneficial effect whatsoever'

Ryanair CEO Michael O'Leary dismissed regulatory discussions around blocking middle seats onboard aircraft after the coronavirus restrictions are lifted as "nonsense" (Reuters, 16-Apr-2020). "It would have no beneficial effect whatsoever... Most of them [airlines] were losing money even when you sell the middle seat". He argued the "best that we would be able to manage" would be to bolster temperature screening at airports and supply of face masks to reduce the risk of transmission of the virus.

American Airlines CEO: 'Demand will recover' once people can leave home, return to work

American Airlines CEO Doug Parker said he believes the majority of passengers are not flying "because they're not leaving their homes and because corporations aren't having people come into work", not "because they're worried about safety on airplanes" (CNBC, 15-Apr-2020). Once people are allowed to leave home and return to work, "that's when demand will recover".

LATAM Airlines Group does not expect full recovery from coronavirus before Dec-2021

LATAM Airlines Colombia CEO Santiago Alvarez Matamoros reported LATAM Airlines Group expects "in the next three or four months we will be at the lowest point" in terms of impact from coronavirus (Reportur, 14-Apr-2020). Mr Matamoros said the airline group tentatively expects to recover to approximately 60% to 70% of its pre-coronavirus schedule by Dec-2020, with full recovery not expected until Dec-2021.

United: 'Travel demand is essentially zero' and 'shows no sign of improving in the near term'

United Airlines CEO Oscar Munoz and president Scott Kirby reported (15-Apr-2020) the carrier is planning to reduce capacity to "about 10% of what had been planned for May at the beginning of this year", with "similar reductions" anticipated for Jun-2020. United's network has been reduced by 90%, and schedule reductions in May/Jun-2020 will create "direct consequences for our frontline employees in terms of total hours worked". "Travel demand is essentially zero and shows no sign of improving in the near term", they cautioned, commenting that "even when travel demand starts to inch back, it likely will not bounce back quickly". Less than 200,000 passengers travelled with the carrier during the first two weeks of Apr-2020, representing a 97% year-on-year drop in demand, with even less passengers expected to travel "during the entire month of May than we did on a single day in May 2019". "We expect demand to remain suppressed for the remainder of 2020 and likely into next year", they warned. [more - original PR]

Southwest Airlines CEO warns of 'very prolonged, sluggish travel environment'

Southwest Airlines CEO Gary Kelly, via the carrier's official blog, said (13-Apr-2020) Southwest needs to "be prepared for a very prolonged, sluggish travel environment", saying he does not think "air travel will snap right back to where it was here this year", though "maybe it will come back next year". However, "if this is a real recession and a bad recession, it could take four or five years" for travel demand to return, he warned, adding this has been the previous experience in the 1990s and 2000s.