The Impact of COVID-19 on Flight Cancellations and Compensation

The unexpected outbreak caused by the novel COVID-19 has brought unprecedented challenges to an impressive number of industries, including the commercial aviation industry. The impact can be explained by the stringent travel restrictions imposed by a few countries to decrease the spread of the virus. As COVID-19 spread worldwide, everything from schools to businesses moved towards online alternatives, travel restrictions occurred, unemployment rates increased, and people barely travelled due to the extremely contagious nature of the disease.

As a result, air travel began to drop by mid-March 2020, while seat availability dropped by 90 percent in April in comparison to the same period one year before dramatically. COVID-19 brought the aviation industry to a standstill for a long period of time, and airlines had to face huge revenue losses.

In this article, we will look at the issue closely to understand how situation within the aviation industry has changed due to the impact of the coronavirus.

Pre-COVID-19 Scenario: The Aviation Industry and Passenger Rights

Flight cancellation can be the most frustrating thing when you are travelling. Before the pandemic, though, this scenario did not happen too often, and there was always a serious reason for that.

Below, you can find a few of the most common reasons for flight cancellation before the COVID-19 outbreak:

1.     Inclement weather. In this case, a plane is grounded for safety reasons that can range from hurricanes and storms to strong winds, or even heat.

2.     Security concerns. Your flight can be cancelled because of security risks, for instance, if there is an attack or threat in the destination you are flying to. They may also cancel the flight due to terror attacks or civil unrest.

3.     Mechanical issues. This reason simply means that the aeroplane is broken and needs to be repaired. This could mean a variety of things, from a faulty engine to a hydraulic leak.

4.     A computer glitch. The technology operates well 99 percent of the time, but the tiniest computer glitch can cause a lot of cancellations across the globe.

5.     Missing aircraft. It is not possible to fly if there is no airplane. Not having an aircraft for a flight may be due to a delayed or cancelled flight at another airport.

6.     Missing crew. Flying a plane is always a serious business, which means that all the pilot crew must be in good flying condition to make sure that passengers are safe during the flight.

7.     Lack of passengers. Sometimes, airlines cancel flights because there are not enough passengers on board. At the same time, the reason is not too common because the damage done to the airline’s reputation and image might be more detrimental.

Most airlines did their best to keep their customers satisfied and tried to compensate for the cancelled flights. For this purpose, they provided vouchers for refreshments, meals, accommodation, and transfers, depending on the length of the wait.

Immediate Impact of COVID-19 on Air Travel

The impact of the pandemic on aviation is devastating. A few representative numbers of 2020 indicate that the number of passengers` number reduced by 60.2 percent compared to the number one year before. This led to a system-wide load factor of 65 %.

Domestic and international air travel demand dropped by 48.8 % and 75.6 %, respectively. In 2020, airlines lost 126 billion USD, on revenue loss of 370 billion USD. At the same time, direct aviation jobs (at airports, airlines, air traffic management, and manufacturers) dropped by around 43 %, while aviation-supported jobs have reduced by 50 %. The aviation industry experienced a partial recovery in 2021, but the industry is far from coming back to normality.

Changes in Flight Cancellation Policies and Compensation

Booking flexible travel is easier now in many ways than it was before or during the pandemic. Airlines are quite consistent in how they allow cancellations and changes. However, there are still a few factors to bear in mind when searching for flights.

Airline policies can range from one company to another, but there are several standards to count on.

• Basic economy. These fares cannot be cancelled or changed for free. it implies that these fares should be avoided by any passenger who is not sure about their plans.
• Free cancellations. Even if it is possible to cancel a fare with no incurring fees, it does not mean that you will receive your money back. In most cases, you will receive a credit or a voucher from the airline.
• Fare differences apply to changes. Passengers have to consider that they will have to pay the fare differences between the initial ticket and the new one.

If you are eager to learn more about flight cancellation policies and compensation, you should visit https://www.skycop.com/cancelled-flight-compensation/ and get acquainted with the provided information.

Financial Impact on Airlines and the Ripple Effect

The dramatic decline in global travel led to drastic financial performances in the aviation industry. In 2020, commercial airlines` passenger revenue made up 189 billion USD. This was a significant decrease in comparison with the 581 billion dollars reported before Covid-19.

According to estimations, the aviation industry experienced revenue losses of 370 billion USD in the same period. In addition to that, airports were affected by the pandemic, and their revenue losses were 122 billion USD in 2020. In 2021, these losses amounted to 111 billion dollars.

Case Study: A Comparative Analysis

According to statistics, flight disruption has become a common thing in post-pandemic travel. Let’s take the UK as an example. Around 32 percent of flights departing from airports were delayed or cancelled in the first five months. This level is much higher than in the two years before COVID-19 because it stood at 25 percent and 22 percent in 2018 and 2019, respectively.

A similar situation can be observed in the US, where the number of cancellations and delays in the first months of the year has surpassed the comparable 2019 period. Their carriers have cancelled around 130,000 flights over the past half year, which is up about 11 %  from the pre-pandemic period.

In most cases, airlines cancel or delay flights due to adverse weather and staff shortages.

Conclusion

Airlines had to quickly adapt to the pandemic. First, they offered change and cancellation waivers to their passengers, but, eventually, they eliminated these fees for many fares. COVID-19 had a significant impact on many spheres of our lives, and airlines are still trying to get back to the pre-pandemic level.