Travel and Aviation: Sydney Airport, Alliance Aviation Services

The aviation sector is one of the most impacted sectors in the ongoing pandemic crisis. As per IATA (the International Air Transport Association), global revenue losses for 2020 passenger business would be between US$ 63 billion and US$ 113 billion, while no estimate is available for the Sars-Cov-2 impact on cargo operations.

Likewise, the Australian aviation industry also suffered a lot in terms of huge losses due to strict travel bans to contain the virus. During this period, Virgin Australia kept the headline spaces occupied with its financial woes and entering voluntary administration after rebuffed by the government for any bailout packages. Now the prominent domestic airline carrier is all set to get a new owner soon.

That said, all sectors are reshaping to keep going in the post-pandemic world. So, is the aviation sector, working together to create country-wide consistent policies for safe domestic air travel to begin with.

Aviation sector comes together to develop safety protocols for domestic travel

The representatives of airlines and airports, Australian Airports Association (AAA) and Airlines for Australia & New Zealand (A4ANZ) have come together to develop protocols for renewing domestic travel during the pandemic and in the post-pandemic environment. All the parties in coalition had introductory meeting on 14 May 2020.

As per AAA’s CEO Simon Bourke, unprecedented but necessary travel restrictions hit the aviation sector first and massively. Now, when the government has eased restrictions in line with its 3-step framework, goal of the travel and tourism sector is the safe resumption of domestic travel.

A4ANZ CEO, Dr Alison Roberts said that the aviation alliance is committed to minimising risk at each stage of a passenger’s journey. It will be achieved through following the expert advice, and also finding a solution that will be practical, efficient and also scalable as passenger volumes increase.

The protocols and plans created by the Australian Aviation Recovery Coalition will be critical in rebuilding travellers’ confidence in air travel. The alliance is working jointly with the government to assure a uniform approach, added Dr Roberts.

Mr Simon Bourke said the resuming of the aviation sector will play a key role in economic recovery. The Australian aviation supports 716,000 jobs and contributes AUD 104 billion to the country’s economy.

Dr Roberts also stated that the sector has an essential role in promoting growth in tourism and business, and in providing access to crucial social, medical, business, educational, and financial services, and moving critical freight including life-saving medicines.

He also added that the coalition is grateful to the government for their commitment towards the aviation sector and the recognition that Australia is more dependent on aviation than other countries. The aviation alliance looks forward to working with the government as the restrictions further ease, and ensuring that people can travel safely with confidence.

The air travel experience to be different in the post-pandemic world

Once the air travel starts again, it is no longer expected to be the same. The world is getting ready for new strict travelling protocols to ensure travellers’ safety from the deadly virus.

Next time when you take a flight, be ready to wear face masks, bring your meals and snacks as there will be no food trolleys and wave goodbyes to loved ones outside the airport. Europe has already introduced these guidelines, and now Australia could be next to follow the protocols.

Now, in this age of social distancing, leaving loved ones outside the airports will keep airports less crowded, and passengers will also be assessed at airports for Covid-19 symptoms. There will also be restrictions for hand luggage and on-board toilet usage.

Australians are being encouraged to plan domestic holiday trips while international travel is still banned for them. At the airports, social distancing measures will be followed, and temperature will also be checked on arrival. Airport and airlines will get regular sanitization to keep germs away.

Sydney Airport urges states to unseal their borders by July school holiday

Amid aviation industry bleeding cash and increasing tiff between states about when to allow interstate travel, Sydney Airport’s (ASX:SYD) boss Geoff Culbert has requested states premiers to allow domestic travels as it is the only hope of survival for many tourism operators.

Mr Culbert has also warned that the tourism sector is losing AUD 1 billion a week. If the domestic travel does not resume during July school holidays, then there will be no other opportunity to revive the pandemic-stricken industry before September/October holidays.

SYD traded at AUD 5.700, up by ~2 per cent on 22 May 2020 with a market cap of 12.63bn,

Alliance Aviation Services expects over AUD 40 million FY20 PBT

Alliance Aviation Services Limited (ASX: AQZ) is the country’s leading provider of the charter, contract and allied aviation services. The company is expecting get more than AUD 40 million Profit Before Tax (PBT) in FY20.

Even before the pandemic, AQZ’s balance sheet was strong, the extra money generated by the increase in the forecast result will further strengthen the balance sheet and already substantial net debt. It will additionally reduce the company’s gearing level.

Alliance Aviation Services is offering free shares to the value of AUD 1,000 to eligible employees, excluding the senior management team. The shares will be escrowed for three years from the date of issue and will be issued on 17 July 2020. It will be made to all part-time and full-time staff and will apply to 85 per cent of the alliance’s employees.

AQZ has also announced that it has not been eligible for any JobKeeper payments and, employees are getting their salaries, sick leaves, annual leaves, and long service leaves. It also stated that their business model had survived the worst crisis in the global aviation industry.

AQZ traded at AUD 2.700, up by 0.372 per cent on 22 May 2020 with a market cap of AUD 342.89m.

Bottomline

While travel and aviation sector is waiting to start in full swing in near term, AU-NZ travel bubble is closely eyed. Besides, travelers will have to adhere to new safety and hygiene norms whenever flights start.

With restrictions easing for economic recovery, aviation can pick the pieces and start again. Still, all depends on duration of pandemic while some analysts are also apprehensive of second wave of infection.