The world shut down in 2020. The word “shut down” implies a complete lockdown. Even of flights. The aviation sector suffered greatly. In the age of globalization, humans were confined. Not just emotionally but also physically. Due to airborne transfer of the disease. Most countries’ borders remained shut for months. The loss was unexpected and various companies struggled. However, things gradually started to improve.
Quite a few countries have opened their restrictions. Conversely, it has resulted in a decrease in aircraft loan rates. The calamity has affected all the stakeholders. The best way is to cope up with loss instead of aiming for profit.
Current Developments in Aviation
The year has changed yet each company is coping up with the loss. Despite the developments in vaccination. COVID-19 has new variants coming in. Each aeronautics company is trying its best to cope up. Whether it is by giving discounts to consumers who want airplane financing. Or through some other tactic such as cutting back on expenses. Recovery is slow but it is happening.
As the demand for private airplanes has increased. Well-off individuals are more willing to buy private jets. There is a fear of spread in commercial flights. The solution is getting a jet of their own. Domestic usage is more than commercial as borders remain closed. This has been observed in various countries such as Turkey, UAE, and France.
Government Aid and Financing
One of the main reasons for the survival of aviation companies has been government. The state has funded aviation companies in various ways. Such as relief in taxes, rescue loans, and securities. The easing of finances has prevented bankruptcy and shutting down. From a consumer’s perspective, it has resulted in increased facilities and emphasis on their needs.
The world for companies is no longer global. More aircraft financing flexibility and operationality have been incurred. For business, new passengers would assist them in being independent again.
Future forecasts of Aviation
Unfortunately, the world isn’t going back to normal. Experts predict that it will take up to 2-3 years for air travel to completely recommence. This means that demand for commercial airplanes will decrease. Hence prices will decline. Airplane financing wouldn’t be as tough. It seems like the perfect time to buy an airplane. Then again purchasing power of consumers has decreased.
Even the ones who can afford prefer to save up. Leasing companies will have flexible terms as it is the need of the hour. It is a gradual process which depends on uncertain factors. Even if the world does get normal. Aviation companies would be under a lot of debt. It would be the result of aids mainly. But many individuals are willing to fly once the world gets back to its usual.
If banks provide relaxed credit periods then an increase in aircraft financing is possible. As the aircraft loan rate would be less. The industry will only recover if all stakeholders contribute. All of us have been adversely affected. The proficient way out is to get out of it collectively.
