The COVID-19 pandemic is having an enormous impact on the aviation industry, affecting passenger traffic, air cargo demand, airport workforce and incoming revenues.
In such turbulent times, its vitally important that industry players are agile and holistic at risk management.
This includes accounting risk, in parallel with direct economic risks in order to survive.
Due to the outbreak of the global pandemic, air traffic suffered a major downfall, slipping by two-thirds last year as per the International Air Transport Association.
Moreover, it is considered to be one of the biggest shocks the aviation sector has ever experienced so far and might be unrecognisable after it emerges.
Further, the number of passengers has reportedly undergone a sharp decline to the level of 2003 at 1.8 billion.
With domestic flights going down by more than a half, international traffic however dropped by three-quarters.
The biggest reasons behind the downfall are border closures and quarantines massively impacting the industry.
The scenario however varies from one country to another with recovery seeming bleak.
In December 2020, the number of passengers on domestic flights in the United States being the world’s top aviation marketsfell by 63 percent.
Meanwhile, the drop was recorded at 43 percent in India whereas it was 12 percent in Russia and eight percent in China.
According to the International Air Transport Association, air traffic is projected to double this year leaving the sector at just half of its pre-crisis level.
Also, it all depends on the virus variants not leading to any further extensions in lockdowns along with new border closures.
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