Airlines Make Profit in 2020
The Covid crisis has hit the majority of flight operators and most face sharp revenue declines. However some airlines have focused on the diversification to change their operations during the crisis and have managed to make profits.
When mentioning this, many should think about cargo operators. Revenue of the whole cargo industry increased $241 billion from an initial $581 billion in 2020 - taking more than 25% of industry revenue, not just the typical eighth. Operators have used aeroplanes that deliver passengers for cargo purposes temporarily, stashing freight in overhead bins and buckling it into seats or removing seats altogether.
Air Canada, British Airways, Lufthansa, China Southern, Emirates have taken seats out to reconfigure aircraft such as B777-300 and A330s into freighters.
Korean Air’s passenger plane removed seats to store cargo.
In the April-June quarter of 2020, export-heavy airlines Korean Airlines, Asiana Airlines, China Airlines and EVA Airways were the strongest four carriers being profitable. Among these four, China Airlines and EVA Airways, surprisingly, had a big drop in revenue in the first quarter of 2020 but had a strong change in the second quarter.
The reason for this significant change is because of the high need of automobile parts (technology components and electronic gadgets), especially personal protective equipment for purposes of pandemic aid and work-from-home demands. The products of these are produced massively in Asia leading to a high amount of delivery from Asia to the US and Europe.
Asiana and Korean Air make profit in Q2 2020.
Ethiopian Airlines is the only airline in Africa to make profit as reported at end of 2nd 2020 quarter, because they keep running up to 40 repatriation charters each week. On the other side, the airlines still have a big loss of ticket sales in 2020. However, the cargo revenue has helped, in part, to revive the aviation industry until the passenger flights recover. At the end of 2020 and the beginning of 2021, it’s predicted there will be needs of cargo operations for shipping Covid-19 vaccines.
Brookfield have seen these movements of the industry in 2020, due to the effect of the crisis, and we have supported airlines to connect, deliver and match the needs. Such as we have been connecting the available and suitable aircraft for cargo demands between different states and regions. Brookfield is seeing the improvement of passenger operations with emergence of jobs for engineers, management and some pilot jobs from October 2020. In order to maintain and keep improving, even in difficult circumstances, Brookfield will continue to stay updated and move strongly where the industry needs arise.
Business and Strategy Manager - Brookfield Aviation International