During this long 8 months of the COVID-19 pandemic, I have often thought about how this event without precedent could make aviation a better industry. The COVID-19 pandemic has put on long-term pause the exponential growth of aviation globally.
I have discovered that for some industry experts, this is a good thing. Lufthansa CEO Carsten Spohr also believes that the COVID-19 pandemic will, eventually, make aviation a better industry. Here is why.
Is this the reset needed?
In some opinions, aviation was due to a reset. Years of exponential growth have been paused, giving the industry a moment to breathe. For one airline executive, this is a good thing. Speaking at the World Aviation Festival recently, CEO of Lufthansa, Carsten Spohr, commented,
“I think there are a few elements of making this a better industry through COVID.”
When we are looking at the huge job losses, financial struggles, and negative growth of the industry, it’s hard to see how COVID could have been anything other than a disaster for aviation. However, Spohr makes some good points about the benefits of this crisis.
More efficient fleets
A marker of the pandemic has been the rapid pace at which the global fleet has changed shape. Early in the crisis, airlines stopped flying their biggest, inefficient aircraft, with the A380 and Boeing 747 swiftly grounded around the world. Many of these large quad jets will not make a return to service.
Spohr believes that this will accelerate the move towards a more efficient, modern global fleet. That is a positive thing for the environment and for cash strapped airlines coming out of the crisis. Spohr said,
“All successful airlines in Europe have been working on their efficiency. The COVID will accelerate this, and they will become more efficient. With large airlines, including us, the sheer size of the fleet has created a certain delay in getting enough more efficient airplanes on board.
“With the fleet being re-dimensioned, it will eventually create a higher share of modern aircraft for airlines like us than we would have seen before COVID, just by the fact that the fleets will be small in general.”
The A380s are unlikely to return to the fleet. Lufthansa itself has made deep cuts to its fleet, retiring many of its large aircraft. A number of A340s will not return to service, and the airline will no longer fly the A380s. The remaining fleet coming out of COVID flying Lufthansa’s livery will be more fuel-efficient, more modern, and fit for the future.
The CEO of Lufthansa, has in the past, been somewhat outspoken about what he has called irresponsible low fares from airlines in Europe. In his view, the industry is oversupplied with airlines, and growth is being artificially stimulated by ultra-low-cost carriers pricing tickets at less than cost value. He believes COVID will stop this trend.
“Before COVID, I had been fairly critical of the blind growth of our industry over the last few years. It makes perfect sense in places like India or China, but I think in Western Europe, to bring ticket prices down to five or ten euros just to create artificial growth – it’s been a trend that I’ve criticized before. I think COVID has stopped that trend.
“I think we’ll be seeing more focused growth, responsible growth, and sustainable growth in the future. COVID accelerated that turn for the better.”
Low-cost carrier Ryanair has often been on the receiving end of Spohr’s scathing remarks.
Indeed, low-cost carriers will largely be coming out of COVID saddled with substantial debts and will struggle to maintain the super low fares to which we’ve become accustomed. Some industry experts are predicting more consolidation in Europe and potential bankruptcies before the winter is out.
While this does not sound like good news, it does, as Spohr says, encourage more sustainable and responsible growth in the future.
I totally agree with Spohr’s outlook and permanent change that airlines have to adopt to fight for survival, let’s see which airline will manage these critical processes to remain fit and survive.