Revenue losses and flight changes: How major airlines are coping with COVID-19 pandemic

Reta Lee
Editor-in-Chief, Lifestyle

With governments around the world implementing border bans and stay-at-home quarantine measures, many of us are deferring or even cancelling our travel plans. Airlines are now drastically slashing prices, waiving flight change fees and fare differences in order to cope with the sudden coronavirus outbreak. Both Singapore Airlines and Cathay Pacific have also announced cutting 96% of capacity through April, while Dubai-based Emirates has stopped flying since 18 March for two weeks.

(Source: IATA)

According to an assessment published by Brian Pearce, a chief economist for The International Air Transport Association (IATA), travel restrictions due to COVID-19 are impacting airlines’ revenues worldwide, amounting to an implied cost of US$113 billion. For markets like Australia, China, Japan, Malaysia, Singapore, South Korea, Thailand and Vietnam, the outbreak is projected to reduce revenue of up to US$49.7b (as per the chart above). Pearce is also predicting that airlines will ‘run out of cash before recovery arrives (as the typical airline had two months of cash at the start of this year).’

(Source: IATA)

Even for countries like Singapore, Japan, South Korea and China that are improving with containment of cases, IATA notes that travellers are not booking flights anywhere. The sharp drop in bookings and increased cancellations reflect the fear of the spread of the coronavirus. Pearce notes that the airlines industry may not even recover six months after the crisis, basing his observations on previous crisis such as Sars in 2003, and the Avian Flu in 2005 and 2013.

Here is how some of today’s airlines are dealing with the pandemic:

Qatar Airways

Qatar Airways is adding 10,000 extra seats to its network, with provision of charter services to Europe, and the US from Asia. The airline also added extra flights to Paris, Perth and Dublin from Doha. In a press statement shared with Yahoo Lifestyle SEA, Qatar Airways is currently operating flights to 75 destinations, though this number may be reduced as nations introduce tighter restrictions. A full list of the routes can be seen at https://www.qatarairways.com/en/travel-alerts/COVID-19-update.html

Singapore Airlines

Singapore Airlines is offering travellers the flexibility of making changes: travellers can retain the value of their ticket and extend its validity; rebookings can be made at a later date; and rebooking fees are being waived. The travel waiver is applicable to customers holding tickets issued on or before 15 March 2020 with travel dates up to 31 May 2020. For more information, log on to: https://www.singaporeair.com/en_UK/sg/travel-info/precautionary-measures/

AirAsia

For AirAsia, passengers can change their flight dates from now until 31 October 2020 without paying a fare difference and flight-change fee for: Flights departing between 23 Mar to 31 May 2020, with bookings made before 23 March 2020; or convert your flights to a 365 days credit account to book a new flight later on. For more information, log on to: https://www.airasia.com/aa/covid-19/en/gb/flexibility-for-you.html

Scoot

Update: Scoot has updated their refund policy. For all customers with bookings made on or before 15 March 2020 travelling on flights scheduled to depart between 23 January and 31 May 2020 but which were cancelled, Scoot now offers two enhanced options to claim a refund: A 100% refund via the original method of payment, or a 120% refund in Scoot vouchers, valid for use within 12 months to make a booking for any travel period available on our website at the time of booking

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As I had previously made a booking with Scoot, I made the necessary changes by asking for a refund via a Scoot travel voucher. This can be done by a self-refund portal which was launched on 17 March. The other two options are: re-routing to another Scoot destination (travel date up to 31 August 2020), subject to availability, where the change fee will be waived, with fare difference payable; and rebooking the flight to a later travel date (up to 31 March 2021) with same origin and destination, subject to availability. The change fee will be waived, but fare difference applies. For more information, log on to: https://www.flyscoot.com/en/announcements/update-on-COVID-19

Malaysia Airlines

(PHOTO: Malaysia Airlines)

Malaysia Airlines is assisting travellers with flight changes. Based on this step-by-step guide, they are advising travellers on how they can make the necessary changes. For more information, log on to: https://www.malaysiaairlines.com/my/en/covid19-travel-updates.html

Emirates

According to the website, passengers are eligible for rebooking and travel voucher options.

Customers with flight bookings for travel on or before 30 June 2020 can rebook their flights to any Emirates destination within the same region without a rebooking fee or paying any fare difference. Customers can also claim for a travel voucher for ticket value with a validity of 12 months from date of issue.

Cathay Pacific

The airline is waiving rebooking, rerouting, no-show and cancellation fees for tickets booked before 23 March 2020. For more information, log on to: https://www.cathaypacific.com/cx/en_US/travel-information/travel-preparation/travel-advisories/novel-coronavirus-information-centre/novel-coronavirus-information-centre.html 

Malindo Air

Malindo Air has arranged for waivers for customer whose plans are affected for immediate travel. Passengers are permitted to cancel their bookings for the travel dates specified and will be offered the following: Notice of cancellation must be a minimum of 72 hours before the scheduled departure time; and a one time change fee will be waived but with fare difference payable.