The airline industry suffered big time in 2020. At the height of shutdowns, travel by air decreased exponentially; this decrease turned out to be so prevalent that airlines dropped their prices by 80% and 90% to attract new passengers.
A drop in demand for flights also caused plenty of layoffs in the airline industry last year. With fewer people traveling, there was no need for as many pilots or airline staffers. As one of the hardest-hit industries, airlines are still struggling to make a comeback, although, it may be a while before this happens.
According to Newsmax, the airline industry lost a grand sum of more than $35 million dollars last year.
A Closer Look at the Struggling Airline Industry
Analysts are currently predicting that the airline industry shall struggle to recover from losses until at least the latter half of 2021. Not only did airlines suffer massive losses, but their debt levels also surged by over $67 billion dollars. This comes in addition to the industry reducing their routes, parking their jets, and laying off thousands of personnel.
— Delta (@Delta) December 21, 2020
Relief for the federal government has provided some assistance to the airline industry; however, they are far from being out of the woods. Prior to 2020, airlines enjoyed a successful and prosperous decade. From growing their networks, purchasing new planes, and hiring employees by the tens of thousands, the airline industry did very well before COVID-19.
The Stock Market
The details of the stock market also provide significant insight into the losses sustained by the airline industry last year. Multiple airlines witnessed significant drops in their share prices; this comes as a natural result of a loss in consumer confidence.
Holiday travel over the Thanksgiving and Christmas holidays has been of value to the airline industry. Despite health officials screaming for Americans not to travel, millions did anyway; even Dr. Deborah Birx traveled for the holidays, despite telling the rest of the nation to only spend the season with members of their immediate household.
American is the first airline to earn GBAC STAR™ accreditation for our cleaning, disinfection and infection prevention protocols on our entire fleet of aircraft and Admirals Club lounges. Learn more on our newsroom.
— americanair (@AmericanAir) December 30, 2020
In 2021, only time will tell whether or not consumer confidence in air travel increases. Over the past several months, multiple airlines have taken heat and controversy for their enforcement of face mask policies.
How much time do you think the airline industry will need to recover from the considerable losses and debt sustained in 2020? Let us know what you think will happen in 2021 in the comments section below.