COVID-19: The impact on commercial airline fleets

07 May, 2020

The systematic and progressive grounding of the majority of the world's commercial passenger airliners in response to the COVID-19 pandemic has been closely watched by analysts, investors and the wider media. The sharp acceleration that began some six weeks ago appears to have reached its apogee, with even a small reduction in the number of inactive aircraft recorded in recent days. Nevertheless, almost 60% of the installed fleet remains on the ground, creating an unprecedented crisis for the world's airlines.

A photograph of two Ryanair aeroplanes at Terminal two of Dublin Airport.

The latest global airline situation

Almost 18,000 commercial airliners are currently inactive. 15,000 of these have been added since the start of the year to the 3,000 parked aircraft that were already on the ground. Fewer than 75 of the additions are freighter aircraft, confirming that air cargo activity remains robust for the moment.

Source: Tracking data is sourced from Ascend by Cirium's Fleets Analyzer.

Note that the basis on which an aircraft is considered to be "active" has recently changed and now reflects aircraft that have been flown on at least three of the prior seven days, or on five of the prior 14. Prior to 27 April, the criterion used was less than seven consecutive days of inactivity. Some caution should therefore be used when interpreting the most recent trend data, although the broad conclusions remain reliable.

Using these parameters, 53% of the wide-body fleet is inactive, compared to 61% of narrow bodies. This counter-intuitive disparity can be explained by the extent to which passenger wide-bodies are now operating in freighter mode to transport essential medical and emergency items.

Regional jet inactivity continues to lag behind the larger narrow bodies. Most of the delayed surge can be explained by the large concentration of RJs in North America, where airlines have discovered that even small capacity aircraft are too large for many markets. 53% are now on the ground.

Source: Tracking data is sourced from Ascend by Cirium's Fleets Analyzer.

With a more balanced global fleet distribution, turboprops have not exhibited the same lag and, with 58% of the fleet on the ground, are more closely aligned with larger narrow bodies.

The impact on lost capacity is even more pronounced, with almost two-thirds of total capacity now showing as inactive and wide-body and narrow-body seats at similar levels. As already noted, however, the wide-body impact will be understated due to cargo-only operations.

Source: Tracking data is sourced from Ascend by Cirium's Fleets Analyzer.

Broken out by fleet, the A380 quickly surged to top the chart, with 98% of the fleet grounded. The A340 fleet has also been progressively reduced, with 80% in storage, and MD80s are in third place with 70% parked.

747, 767 and 777 storage levels appear low in comparison to other large jets. However, when freighter variants are excluded from the totals, storage levels for the passenger fleets move up to 90%, 77% and 56% respectively. In fact, less than 10% of the total freighter fleet is currently parked, which pushes the stored passenger fleet percentage up from 58% to 62%.

The regional breakdown reflects the rolling wave of advancing virus epicentres. It suggests that Asia-Pacific may now have passed beyond the peak, led by the gradual return of China domestic fleets. Other regions have also now plateaued but at much higher levels of grounding apart from North America, dominated by the USA, where airlines have been slower to pick up the pace and, primarily due to the terms of US CARES Act funding, continue to operate a core domestic network, albeit with a stark absence of passengers.

Source: Tracking data is sourced from Ascend by Cirium's Fleets Analyzer.

Looking at some of the most severely COVID-19-affected countries, China has remained surprisingly and consistently moderate overall, with no more than 25% of its fleet fully idle at the peak. This belies the facts that international flights have been mostly shuttered (over 60% of wide-bodies on the ground) and domestic flights have been operating at severely reduced levels. The Big 3 in particular appear to have decided to keep the majority of aircraft in service, but operated infrequently, resulting in very low fleet utilisation.

India has been amongst the most heavily impacted markets in Asia, with 95% of the fleet rapidly placed on the ground. The other APAC region airlines are starting to move beyond the peak, but almost 60% of the overall fleet remains inactive.

Elsewhere, Brazil and Spain have almost 80% of their fleets parked, with the UK even more severely affected, but Italy somewhat less affected. Although all have now plateaued and stabilised, there is no evidence yet of the start of a recovery.

The challenges that lie ahead

Global airlines appear to have reached the peak of their inactivity. The impact has been felt almost entirely in passenger fleets, with less than 10% of the freighter fleet currently inactive. Data from apps such as FlightRadar24 reveal that outside of US and China domestic markets, a high proportion of aircraft in the air at any time are performing cargo missions. Overall, commercial flight frequency has declined by 80% since the start of the year.

Source: Tracking data is sourced from Ascend by Cirium's Fleets Analyzer.

With almost 60% of the global airline fleet on the ground and passenger traffic at barely 10% of prior levels, the challenges faced by airlines as they plan their paths to recovery are many; as they fight for survival, they will also be faced with considering what the future shape and size of the industry could look like once the world manages to exit this crisis and returns to work.

Author: Dick Forsberg

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