Covid-19 likely to force airlines to decline investing in new aircrafts

The COVID-19 pandemic has had a profound impact upon the commercial aviation industry, with lockdowns and border closures evaporating passenger demand. Stricken by lost passenger revenue, airlines have cancelled outstanding orders and reduced the size of their fleets.

Given the depressed state of the commercial aviation industry, both aircraft manufacturers and airlines are more likely to adopt a conservative policy, says GlobalData, a leading data and analytics company.

Decarbonisation might become a priority by EU pushing Airlines to adopt green policies.

Harry Boneham, Aerospace and Defense Associate Analyst at GlobalData, comments: “Manufacturers such as Boeing and Airbus are unlikely to invest in the development of new platforms in the midst of one of the worst economic downturns the industry has faced. On the other hand, there may be considerations generated by the COVID-19 pandemic that may drive airlines to look to new designs in the medium term.

“The campaign to reduce the environmental impact of commercial aviation predates the current crisis, with concepts such as flygskam growing in prominence. However, a campaign to incorporate and accelerate the adoption of green policies in the economic restart following the COVID-19 pandemic has been gathering pace.

For instance, in the European Union’s 14 air transport associations have called for decarbonisation to be prioritised in post-COVID-19 recovery funding. Among the initiatives suggested is the replacement of older models which are on average 20-25% less fuel efficient than newer generations.”