On Monday, many of the world’s airlines put into effect cost-cutting measures. These tough decisions come amid the COVID-19 pandemic, which has all but stopped air travel.
In a joint statement, SkyTeam, Oneworld, and Star Alliance, the three largest airline groups, held a press conference early this week where they announced they’ve been grounding planes, cancelling flights, reducing employee hours, suspending employee contracts all together, and freezing spending. With relatively no revenue coming in, airlines are hemorrhaging money. The alliances requested government bailouts amid these “unprecedented challenges.”
Senior research analyst Daniel Roeska, of Sanford C. Bernstein & Co. in London, said “Airlines are siphoning cash and have no way of stopping it…the key focus should be on emergency liquidity support and enabling short-term layoffs or working-hour reductions to safeguard cash.”
The British, German, Dutch, and French governments are reportedly all discussing an airline industry stimulus package. There have been no signs of the US government doing the same. Several American news sources have run articles condemning assistance to the airline industry. The New York Times muses, “As the government asks what we, the public, should do for the airlines, we should ask, ‘Just what have they done for us?’” It seems the years of baggage fees have left people without much sympathy.
The larger issue is that the airline industry is only one of many that could be brought down by this pandemic. The industries like hospitality and sports and the people that work in them will need government assistance one way or another to survive.