As we have noted before, the pandemic did not lead to as many airline collapses as some feared, given that the industry was barely flying or generating revenue for more than a year. Moreover, in the 18 months or so since travel restrictions began to ease, the vast majority of carriers have managed to rebuild their fleets and operations without running out of cash.
In fact, IATA estimates that about 85 operators failed since the start of the crisis (many of which were already on life support), but 45 launched, or, like Flybe and Jet Airways, reappeared. It shows that, for all its risks and capital requirements, the business remains attractive for entrepreneurs, and one airline’s failure or withdrawal often leaves a tempting gap in the market for another.
Take transatlantic. While there have been attempts at introducing services between Europe and the USA and Canada with fares that undercut the majors since the days of Freddie Laker in the 1970s, Norwegian was the latter-day pioneer, flying to secondary US cities with a fleet of Boeing 787s. The Scandinavian low-cost carrier pulled the plug on its long-haul operation as Covid-19 hit.
Others have stayed, or entered the market – with long-range versions of the Airbus A321 seen as key to making long haul, low-fare travel profitable. They include JetBlue, Norse Atlantic, and now a start-up called Fly Atlantic, which plans to launch services from Belfast in summer 2024. Northern Ireland residents currently have to travel to Dublin or the British mainland to fly over the ocean.
Norse Atlantic has been clear that it wants to step into the shoes of Norwegian on the transatlantic market (the two airlines are unconnected but have similar names and fleets). After being granted authorisation to operate to the USA from London Gatwick in October, the 787 operator last week announced it had raised NKr300 million ($30 million) from investors in Norway to fund its expansion.
The pandemic created other kinds of openings for small carriers. UK regional airline Loganair has been serving small communities in the Scottish Highlands and Islands as well as a handful of smaller city airports for 60 years. However, when airlines began vacating slots at London Heathrow in the pandemic, Loganair spotted an opportunity, launching flights to the Isle of Man in late 2021.
While its tenancy at the country’s biggest airport is temporary, Loganair’s chief executive Jonathan Hinkles believes shifting attitudes to regional connectivity may help it make things permanent. Because slots at Heathrow have been rare and pricey, regional airliners are a rare sight, but this makes it hard for those in many UK communities to travel internationally through the hub.
The fact that it is easier to get from New York to Krakow via Heathrow than to Cornwall has an adverse effect on investment into the UK’s regions and the export potential of businesses there, some believe. They hope this is something the UK government will address as part of its so-called “levelling-up” strategy for the parts of the country distant from the capital’s economic halo.
Hinkles thinks airlines such as his could play a role in helping connect the different bits of Brexit Britain to the world. How a privately run Heathrow could be persuaded to embrace regional airlines once the sector is fully back to speed again and the airport struggling with capacity is, of course, another matter.
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