Airline & Tourism Industry : Flying With Clipped Wings

The pandemic has dealt out a severe blow to the airline and tourism industry and it is unlikely to emerge from this situation soon enough. Geyatee Deshpande discusses that while gradual phasing out of lockdowns across the world will rejuvenate the air travel sector, the luxury holiday and resort sectors are unlikely to find many takers

- Geyatee Deshpande

Globally, the airline and tourism industry has witnessed many hiccups. A recent example includes that of Thomas Cook Plc. Being one the world’s oldest travel firms, the tour operator had its business arms spread in operational areas such as hotels, resorts and airline sectors. But as a result of its failure to adapt to the fast developing travel and tourism environment and also to the challenges posed by competitive peers, the company incurred heavy losses and was forced into liquidation. Faced by the impact of Brexit as well as failed mergers, Thomas Cook Plc and its subsidiaries announced its bankruptcy suddenly, thereby shocking the world, travellers and investors.

Similarly, one of the most preferred airline companies by many, Jet Airways witnessed its sudden crash as a result of debt issues, lack of concrete business model and failure to find strategic investors to pump money into the debt-ridden company. Owing to these troubles, the company had to suspend all operations in April 2019. But though the industry has been battered with such shocks, it hadn’t witnessed majority of its operations being halted for months as has happened due to the virus-triggered pandemic. During the previous crisis situations, weak demand was but a normal offshoot but the current pandemic has axed the industry totally.