The first Airline Business Index puts the airline industry at 0.58 of its pre-pandemic size at the end of 2020 – with 1 being the benchmark size at end-2019 – amid the devastating impact of the Covid-19 pandemic.
Using data from the 15 largest airlines and airline groups that release quarterly results, the index considers four metrics: size of workforce by employee number, size of fleet (in-service and stored), and revenue and passenger numbers in the most recent period – in this case, the fourth quarter of 2020.
It compares those metrics with equivalent data from 2019.
The index shows a strong disconnect between the fundamentals of the businesses – employee count and fleet size – and the operating performance.
That partly reflects an expectation that the industry will begin to recover from the demand lows seen in recent months during the second half of 2021, but also the fact that many carriers are only part-way through the resizing of their businesses, with employee layoffs, redundancies and fleet retirements taking some time to action.
On a quarterly basis, FlightGlobal will release an updated Airline Business Index as the industry attempts to recover from the Covid-19 crisis.
Notes: Data at 31 December 2020 or for the fourth quarter of 2020, taken from publicly available records. Basket of 15 airlines based on the largest carriers/groups that report quarterly results from FlightGlobal’s World Airline Rankings based on revenues. Datasets complete for all metrics except workforce size, for which the number is based on data from 12 airlines/groups. Overall index score is an average of the scores for the four individual metrics. The overall index score could eventually exceed 1 while some metrics remain below that level, helping to demonstrate fundamental changes to the industry.