Due to Covid-19, the global aviation industry is calling for urgent relief.

Accordingly, the three largest airline alliances in the world—OneWorld, SkyTeam, and Star Alliance—had to issue a joint statement calling on governments to provide urgent support to airlines.

Norwegian Air announced it would cut up to 85% of its flights. (Image: Business Insider)

The drastic measures taken by governments in many countries are causing economic stagnation and affecting many industries, most notably in the aviation industry, where most airlines have had to cut flights at unprecedented levels. Norwegian Air announced the cancellation of up to 85% of its flights and the temporary layoff of approximately 7,300 employees – equivalent to nearly 90% of the airline's workforce – due to the Covid-19 pandemic. Cathay Pacific also cut its operating capacity by 90%, and Air France made similar cuts. Air France CEO Ben Smith even had to take a 25% pay cut...

Recognizing the Covid-19 crisis as the most severe in the history of the global aviation industry, three airline alliances – OneWorld, SkyTeam, and Star Alliance – issued a joint statement calling on governments to provide urgent support to airlines, an unprecedented move. These three alliances argued that airlines are running out of cash and there is no way to stop this trend, as flights are unlikely to resume for another six to eight weeks. Therefore, the survival of airlines “lies in the hands of governments.” Governments in countries such as Germany, France, the Netherlands, and the UK have announced they are considering solutions to “save” the aviation industry.

Passengers line up in front of the Delta Airlines ticket counter at Roissy Charles de Gaulle Airport in Paris, France. Photo: Reuters.

In the US, the airline industry is also calling for urgent government support. The three largest US airlines – American Airlines, Delta Airlines, and United Airlines – have urged the government to provide direct aid packages or guarantee bank loans totaling over $50 billion. Additionally, US airlines are proposing to defer tax payments until the end of 2021. Nicholas Calio, President of American Airlines, stated: “This is a problem of today, not tomorrow, and requires urgent action.” The Trump administration had previously signaled its willingness to support several industries most severely affected by Covid-19, including airlines. If approved, this would be the largest bailout package for the US airline industry since the 2008 financial crisis.

Not only the aviation industry, but many countries are also calling for state-level relief. International Monetary Fund Managing Director Kristalina Georgieva said that 20 countries have requested relief packages from the organization to cope with the economic downturn. Currently, the International Monetary Fund has mobilized $1 trillion to help its members overcome the crisis caused by the Covid-19 pandemic.