2.

SUPPLY AND DEMAND OF AVIATION INDUSTRY ARE IMPACTED

NEGATIVELY DUE TO COVID-19 CRISIS

The COVID-19 crisis, travel restrictions, and the subsequent economic crisis changed
passengers' behavior, resulting in a drastic drop in demand and supply for airline services.

2.1 The demand size:

The number of commercial flights monitored by Flightradar24 between February and

December 2020 is shown in below map. The study discovered that the highest volume of
commercial flights occurred during this time span, with the highest number of monitored daily
flights occurring on 14 February, with a total of 109,400 flights registered. Following this date,
the number of flights decreased dramatically, owing primarily to the implementation of steps
such as airport closures.

Since the borders were closed in March 2020, almost 39,200 special repatriation flights
returned almost 5.4 million people.

At the height of the pandemic response, almost 46,400 special cargo flights delivered 1.5
million tonnes of cargo, mostly medical supplies, to regions in need.
 The number of scheduled flights in the first week is 400 thousand flights and rose to 750
thousand flights in week 2. This figure saw a dramatic decline of approximately of 500 thousand
to 200 thousand in a period of subsequent 18 week. From week 22 to week 52, the quantity of
scheduled flights increased to about 450 thousand.

In terms of airline losses (-$11.9 billion) and EBIT margins, Europe is predicted to be the
worst-affected global market in 2021. (-9.5%). With the exception of Africa (-72%) and the
Middle East (-72%), passenger traffic is expected to have dropped by 70% this year, the worst
result of any area (-73% ).

2.2 The supply size:

International civil aviation organization(ICAO) also stated that, first six months of 2021, the
number of seats provided by the aviation industry decreased from 42-47%, the number of
passengers transported decreased from 47-57% and revenue will decrease from 156-181 billion
USD compared to 2019.
 Through airports, the number of passengers was estimated at 66 million and 1.3 million
tons of cargo, decreased by 43.4% in passengers and 15.6% in cargo respectively compared to
2019.

The number of jobs sponsored by aviation could drop by 46 million to 41.7 million (-52.5% )

The number of direct aviation employees (at airlines, airports, factories, and air traffic
control) has decreased by 4.8 million (a 43% reduction compared with pre-COVID situation).

The global in-service fleet stood at about 19,200 aircraft as of July 10, down from almost
28,000 in early January — before the world learned about COVID-19. The current fleet number
reflects airline decisions to bring back 9,800 planes in late spring, when everyone thought the
pandemic was over. The aircraft had been reduced to 12,724 planes at its lowest point.

According to Vietnamese airlines, the initial cost of the pandemic is expected to be US$1.3
billion. Around 10,000 workers, or about half of Vietnam Airlines' workforce, were forced to
take unpaid leave.

REFERENCES :
1. “Europe continues to suffer from depressed demand“
https://airlines.iata.org/news/europe-continues-to-suffer-from-depressed-
demand
2. “COVID-19 pandemic and prospects for recovery of the global aviation industry”
https://www.sciencedirect.com/science/article/pii/S0969699721000053?
casa_token=Lo_SEtzSQZwAAAAA:mhM0VdhveroPOfWcktkb42nW1IHgI00rmmOr
z7RvrHidNRA3qmqbk_2TOMcj5JWMg0W-Hn2Xw
3. “The impact of COVID-19 on aviation” https://airlines.iata.org/news/the-impact-
of-covid-19-on-aviation
4. “THE CIRIUM AIRLINE INSIGHTS REVIEW”
https://cirium.lookbookhq.com/the_airline_on_time_performance_report/2020
-airline-insights-review
5. “Kịch bản nào cho ngành hàng không năm 2021” https://vov.vn/emagazine/kich-
ban-nao-cho-nganh-hang-khong-nam-2021-846690.vov