Gediminas Ziemelis, Founder and Chairman of Avia Solutions Group: 2020 wrap up - $118.5 billion in aviation industry losses and the eager wait for salvation
Dec 29, 2020, 09:58 ET
LIMASSOL, Cyprus, Dec. 29, 2020 /PRNewswire/ -- 2020 was supposed to be great for the aviation industry - adoption of new technologies, AI integration, and focus on sustainability seemed to make 2020 the year of development, improvement and growth. The year's strong start raised our hopes up that it would be truly memorable.
In the early spring, Covid-19 panic led countries to close borders and ground thousands of airplanes in an attempt to stop the virus from spreading globally. Unfortunately, even closed borders had little to no effect on stopping the spread of this resilient disease. Yet, thanks to that, economies plummeted; thousands of people's lives were left at stake.
According to the International Air Transport Association (IATA), only one in every 27 million air passengers gets COVID-19. The risk of disease transmission on board is reduced to a minimum by a number of factors: modern aircraft airflow systems, High Efficiency Particulate Air (HEPA) filters, and high rates of air exchange efficiency. While governments blamed air travel on the spread, health care experts claimed that the infection risk was lower on a plane than in places such as stores and restaurants - HEPA filters capture 99.97% of airborne particles, substantially reducing the risk of viral spread, and the air in plane cabins is completely changed over 10 to 12 times per hour, raising the air quality above that of a normal building.
Despite this, passenger air travel is still largely restricted, continuing to damage countries' economies. According to IATA, the aviation industry alone is expected to suffer a net loss of $118.5 billion for 2020. Deep industry losses are thought to continue into 2021 with a net loss of $38.7 billion, even though performance is expected to improve over the period of the forecast. So now, while we count our losses, we patiently wait for the only possible salvation there is - vaccines.
Currently 61 vaccines are in human clinical trials. The Pfizer vaccine became the first to be approved for urgent use in a number of countries and brought a new challenge to the table - transportation. The vaccine requires shipments to be transported at a temperature of near minus 70 degrees Celsius (-94°F), making only a small number of companies globally able to take on the operation. Other players in the vaccine race are slightly more forgiving with their transportation requirements - Moderna requires shipments to be held at -20°C (-4°F), while the University of Oxford vaccines would be the easiest to transport and could be stored at regular fridge temperatures of 2 to 8°C (35.6 to 46.4°F). Unfortunately, the temperature isn't the only problem at hand.
Accenture's Seabury Consulting estimates the global rollout of a vaccine will generate 65,000 tons of airfreight, which is five times the air vaccine trade in 2019. Additionally, according to the International Air Transport Association (IATA), providing a single dose to 7.8 billion people would fill 8,000 747-cargo aircraft, something the aviation industry cannot provide so easily.
The industry is already getting ready for the inevitable task of urgent vaccine transportation and chances are that the New Year will start on a positive note. Mass vaccination will help us all to get back to the life we were used to - to spending time with families and friends, visiting breathtaking places and experiencing new things. So, pack your bags for Q2 2021, because the aviation industry will be getting back to business.
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About Gediminas Ziemelis:
Gediminas Ziemelis is a founder and chairman of "Avia Solutions Group" - one of the largest aerospace servicing companies presented in more than 67 countries. In 2016, G. Ziemelis received a prestigious European Business Award in recognition for his visionary business management and development skills. The same year, under his leadership, Avia Solutions Group was named a national public champion in the category of Entrepreneurship, earning a spot in the top 110 of European businesses. Twice, in 2012 and in 2014, Ziemelis was acknowledged as one of the top 40 most talented young leaders in the global aerospace industry by the leading USA aerospace magazine "Aviation Week." 2014 – 2017 Gediminas Ziemelis personally supported and consulted Chinese Banks (including ICBCL, CMBL, and Skycop) with regard to financing aircraft sale-leaseback transactions in the CIS region. His total value of transactions – more than $ 2 B. 2006 – 2013 Gediminas executed successful IPOs of 4 companies at OMX and WSE and raised public capital worth more than $ 100 M.
More info: www.gediminasziemelis.com
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SOURCE Avia Solutions Group
