'It will be like
this: If you use the window seat in the first row, next will be the aisle in
the second row, to maintain social distancing.'
'So, two-thirds of the aircraft is not going to be used.'
'So, two-thirds of the aircraft is not going to be used.'

Kindly note the image has been posted only for
representational reasons. Photograph: Adnan Abidi/Reuters
Aviation worldwide has been
devastated by the novel coronavirus.
With no flights in the air
for four weeks and no sign of resumption of any activity, India's aviation
industry could post a loss of $3 billion in the June quarter, says aviation
consultancy firm CAPA.
Even after the resumption
of flights, things may not go back to what it was before the coronavirus
struck.
According to reports, the
Directorate General of Civil Aviation is formulating a new set of standard
operating procedure for airlines post-lockdown that will make it mandatory to
maintain social distancing onboard flights.
So expect at least two
seats in a row to be kept vacant, no onboard meals, restricted boarding etc.
With airlines forced to
keep at least one-third of their seats vacant, the cost of tickets may shoot
up, thus putting flying out of reach for a large section of an already nervous
populace.
"Fear is going to
inhibit people from travelling, definitely for more than a year for
international travel," aviation expert and former Boeing 737 instructor
pilot Mohan Ranganathan,
The
first casualty of the coronavirus pandemic in Europe was low cost airlines. In
India, we do not know how bad the situation is. How long do you think it will
take for the Indian aviation industry to rise from this massive slump?
It
will take not less than two years. In fact, it will be very bad for the next
two years.
All
small airlines will take a big hit. You will see many small airlines fold up.
Unless
they have financial backing, they will not survive. Those who survive will have
to be with deep pockets.
If
you take the Indian context, Air India, of course, will not fold up as the
government will back it up.
Vistara
will survive as it has the backing of Tata and Singapore Airlines.
And,
Indigo, if they are careful and downsize, will survive
I
doubt whether the others are going to survive.
Do you think people will stop flying for some
time because of fear?
Fear
is going to inhibit people from travelling, definitely for more than a year for
international travel.
You
can forget about any family travel globally because of quarantine and all these
tests.
People
will not travel for tourism, they may travel to the place where they have their
family.
So,
forget about tourism for the next couple of years.
Maybe
in Europe, people may travel. But because of the fear of flying, people will
prefer to drive.
When
they drive, they know they are not being exposed. People will travel only where
there are good roads and good travel facilities on the ground.
As
far as international air travel is concerned, it is not going to happen much.
The
best yardstick is what Singapore Airlines has done by grounding so many
aircraft. Changi airport has closed one terminal because they expect a severe
downturn.
Air
New Zealand has laid off all the 777 crew. It means they do not expect any
long-distance flights for some time.
So, job losses connected with this sector is
going to be huge.
Very
big! Job losses will not only be among the airlines, but there will be job
losses in connected industries also.
If
there are no tourists, it is going to affect not just the airline industry, but
other industries also.
The
hotel industry is going to take a big hit. Many of them cater to airlines and
that is going to be stopped.
You
have a lot of ground staff contractors. They would have invested taking loans
expecting an expansion, and they are going to lose on that.
All
of them have been fallen prey to the utopian numbers given every year, but
nobody has planned for a rainy day.
So,
you are going to have job losses and business losses, not just in the airline
industry but anything connected with the airline industry. They are all going
to be badly affected.
How much are the airline companies going to
lose when aircraft remain idle?
The
losses are huge because very few airlines own the aircraft. Most of them sell
it and lease it back. So, those who make money are the promoters.
And
the airline companies have to pay the lease amount in dollars.

IMAGE: Mohan Ranganathan. Photograph: Sreeram Selvaraj
What you earn is in local
currency. Unless you have international travel, you are not going to earn in
dollars. In the last one month-and-a-half, the rupee has gone down by Rs 7 or
so against the dollar.
So, when you have zero
income, your cost is increasing day by day.
It was reported a month ago
that the only airline that has a cash reserve is Indigo with Rs 30,000 crores.
Ten days ago, the reports say Indigo now has a cash reserve of Rs 9,000 crores.
The other airlines were all
in negative figures.
I don't think any bank is
going to give easy loans to the airlines because there is no prospect of recovering
your loan.
The very fact that they are
selling tickets even during the lockdown saying they will give you a voucher
shows they need cash. They are cash starved.
The government has asked
the airlines to refund the money to all those who had booked earlier. How are
they going to do it?
The government can say. If
they don't, what can the government do? They cannot take any action because
there is no legal backing to it.
It is just a government
order; it is not a law. So, you can't take the airlines to court.
If they don't have the
money, how can you expect them to refund?
Even if the airlines have
flash sales, you will see that very few numbers will book in future.
Even if they say you buy a
Rs 1,000 ticket and the ticket is valid for one year, the trust value of
aviation is gone.
Only rich people can afford
airline travel hereafter, not the middle class or the lower middle class. They
are not going to travel again.
Could it be because of the
fear connected to the coronavirus?
It is not that. People will
be weary now with all the additional security.
Earlier, you may have a
fever and normally you would have travelled. But now, at the point of boarding,
they may say we will quarantine you. When you are quarantined, your whole
programme gets affected.
The best example I can give
you is Viswanathan Anand is stuck in Germany while his wife and kid are here (in
Chennai). Even he will think twice before travelling out.
In future, people will
really worry about travelling. I expect it will take at least a year for the
fear to die down.
After 9/11, air traffic
dropped tremendously.
After SARS, air traffic
dropped tremendously. But it recovered because it was not a worldwide phenomenon.
It did not affect all the countries and we didn't have a lockdown like this.
Now, when you have a
lockdown like this, you have airlines all over the world on the ground.
And this is going to take a
long time for a recovery.
It is said that because of
the need to have social distancing, fewer people will be allowed inside a
flight. Does that not mean the prices will go up?
Yes, 60% of the seats
cannot be used because of this.
It will be like this"
If you use the window seat in the first row, the next will be the aisle in the
second row, to maintain social distancing.
So, two-thirds of the
aircraft is not going to be used. Only 30% of the aircraft will be used.
In such a situation, no
airline can survive.
You don't even break even
unless the fares are exorbitant. Then only the super-rich and the freeloaders
can travel.
When they started low-cost
air carriers, they said they wanted to take away the bus and train passengers.
With so many restrictions,
with early check-in, with less luggage being allowed, people are just going to
stop travelling by flights.
In fact, people will be a
little scared of travelling by train too.
I foresee more and more
people driving and taking taxis.
How can the aviation sector
tide over this difficult period? Just wait?
Yes, they have to wait. You
have to start very slowly, from scratch.
First, you have to downsize
now that travel is going to be highly restricted. Even if they remove the
restrictions, it is going to take time to get the trust and confidence of
passengers.
So, you must build up
dynamically, starting slowly and in a small way.
How huge will be the losses
for the airline industry globally?
IATA says it is going to be
around $200 billion!
Job losses in India will be
around 30% to 40% for selected categories like pilots and engineers. For the
other people, it might be around 60% to 70%.
So, you expect at least a
couple of years for flights to be in the sky?
Even after two years, I
expect only 50% of the current numbers. There will not be a boom time for
another 5 years.
Because the world economy
is in shambles, the tourism industry is going to be in shambles. So, without
tourists and without business travel, airlines cannot pick up that fast.
Do you feel the coronavirus
has made people and countries rethink athe future and rebuild everything from
scratch?
Yes. The virus has taken us
back by 30, 40 years!
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