The Business Update with Vivian Benishek
Wednesday, July 22, 2020
Hang on Tight: The Airline Industry’s Long, Bumpy Ride in the COVID-19 Era
“The flight-status monitors were a stark reminder of the pandemic’s overall effect on travel. Nearly every scheduled flight was canceled.” These are the chilling words of Benjamin Goggin, the digital culture editor at Business Insider, who traveled this past April from New York to Minnesota, all in an effort to support his family during the coronavirus pandemic. He recalls the bizarre feeling of being greeted by deserted terminals, with countless stores and restaurants shut down, and airport staff fully geared with masks, gloves, and hand sanitizer. Once onboard the Delta aircraft, Goggin, along with the other 35 people on the flight, received “one plastic bag with Cheez-Its, cookies, a water bottle, and an alcohol sanitizing wipe.” This incredibly surreal flying experience tasks both passengers and airlines to follow through on their responsibilities regarding all safety and hygienic protocolS. Now, amidst the COVID-19 pandemic, it is evident that the hustle and bustle of our airports have mostly been replaced with the eeriness of a ghost town.
This new shocking and dreary travel experience has become all too familiar as the coronavirus outbreak continues to swallow up and infect as many cities as possible across the United States. Domestic air travel has come to a halt, with the economy taking an extremely hard hit. According to CNBC, United Airlines shared on Tuesday, July 21st that it “lost $1.63 billion during the second quarter,” with revenue down 87 percent compared to the same time last year. The airline is hemorrhaging $40 million each day, which is down from $100 million in April. To make matters worse, the company released a memo explaining how a third of its overall workforce of 95,000 could face layoffs around October 1st. This serves as a measure to reduce employment until a widely available vaccine is found. Back at Wall Street, things aren’t looking too sweet. The Motley Fool showed how rising coronavirus cases, especially in California, Florida and Texas, have caused shares of Spirit Airlines to plummet down to 5.5%, while Southwest Airlines went down about 3% at the close on Monday, July 20th.
Most of all, the travel data comparisons between 2019 and 2020 are quite striking. The Transportation Security Administration recorded that 747,422 travelers went through a TSA checkpoint on Sunday, July 19th. Believe it or not, one year ago on that same day the number was a whopping 2,727,355. With not a soul in sight, empty airports and its scattered airlines must focus on reshaping the way we fly and making it a safe and comfortable experience. There is no room for error and we are forced to adapt to change quicker than ever. Overall, it’s no surprise that the airline industry faces a dull and challenging future, one that will make us travelers pay a heavy price.
That’s it for this briefing. See you next time!
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