There is “limited time left” for the government to intervene in aviation before there are “real business failures”, an airline boss has warned.
Loganair chief executive Jonathan Hinkles told the Airlines 2050 summit yesterday: “There is a serious risk of this government achieving a carbon neutral aviation industry by 2021 because it won’t be here.
“We’ve seen a support package for hospitality. There is a limited amount of time left if the government is going to make a difference.
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“I’m surprised we haven’t seen any real business failures yet. I’m not just talking about airlines but about airports and ground handlers.”
Hinkles said: “The government response has been far too slow and far too halting.”
American Airlines managing director for Europe and Asia-Pacific Rhett Workman told the summit: “Last year, we were the biggest airline in the world. This year it feels like we’re a start-up and we’re looking to recreate ourselves.
“Creating a test regime is imperative. We need regimes put in place as quickly as possible.”
Workman described the future as “a little scary”, saying: “We’ve seen 40,000 leave the businesses. That is a lot of talent leaving. Are we going to have the team members to support flying when it is ready to go?”
Senior commercial aviation consultant David Huttner of PA Consulting said: “There are going to be failures. There is going to be consolidation. But we also see parties willing to take opportunities if debts can be restructured.”
He cited the deal to resurrect Flybe, announced at the start of this week, as an example. But Huttner added: “There will certainly be a few less players in a year or two.”
Huttner noted airlines’ yield-managing pricing algorithms are of no use in the current crisis.
He said: “Reliance on machines does not match people’s experience and intellect when the only flights open are to Greece and that could change on Thursday.”
Huttner added: “You can’t assume the profile of customers and the mix of customer profiles will return [ad before]. You may hit 2019 levels of traffic at some point, but to believe we can act like this never happened isn’t realistic.”
Lufthansa senior director for sales in the UK and Ireland Andrews Koster said: “Bookings come only late at the moment. If I was booking, I would wait. I know the flights will be there, but will I still be able to go and come back or will I need to go into quarantine?
“If there is some clarity, this will change.”
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