Was it right for Qantas to postpone Project Sunrise?
Alan Joyce, the chief executive officer (CEO) of Qantas, stated that the Australian airline was “a couple of weeks” away from finalizing its order for the Airbus A350-900ULR that would have launched its Project Sunrise flights. The plan was to launch the non-stop flights between Sydney, Australia and New York and London in the first half of 2023. But was the decision right?
The current crisis has sent Qantas into survival mode. The airline, of course, is not alone, as the whole sector has suffered massively. Joyce himself stated that this was the “worst crisis we have ever come across,” during Centre of Aviation (CAPA) Australia Pacific 2020 Aviation Summit on September 2, 2020. One of the decisions that Qantas was forced to make was to cut costs and limit its capital expenses. The airline let go of over 6,000 employees, with another 2,500 jobs in peril, noted the chief executive. Aircraft orders were also placed on hold, including the 12 Airbus A350-900ULR order, which was delayed until the end of 2020.
“We would rather wait for the coronavirus issue to be out of the way before we put a firm aircraft order in for the A350,” Joyce told the Executive Traveller at the time.
However, what if Qantas were to launch the Project Sunrise flights, despite of the current situation and the uncertain future regarding international demand?
The main problem of international, including ultra-long-haul, travel is the fact that the rules on where customers can land without the need to self-isolate are constantly shifting. The uncertainty does not make a good mix with a risk of contracting the virus, resulting in passengers loosing confidence to fly whatsoever. According to Joyce, the Australian group will not have a substantial international route network until July 2021. Even after it is restarted, Qantas expects to operate its international itineraries at 50% of its pre-COVID-19 levels. While only a forecast, which as Joyce noted can still change, it does illustrate the current mood around international travel.
Numbers, released by the International Air Transport Association (IATA) on September 1, 2020, painted a grim picture. According to the industry body, the demand for International travel crumbled by 91.1%, as capacity was at 85.2% of July 2019 levels. Planes were flying half-full or half-empty, depending on the outlook on life, as on average 46.4% of seats on board were occupied.
“Governments have cooperated to set the guidelines for a safe re-start of aviation,"stated IATA’s chief executive Alexandre de Juniac. "But they have not cooperated to actually make a re-start happen.” Bubbles are an option to slowly restart international travel. Both de Juniac and Joyce have expressed their support for them.
If the issue of people being forced into quarantine is solved, “with markets that have low levels of transmission, like New Zealand, maybe Japan, maybe some countries in Asia, then you could see these bubbles opening up one by one,” commented the chief executive of Qantas.
Travel bubbles have been opened all across the globe, including the ground-breaking Indian attempt to create a multi-national travel bubble. The Asian country has set up agreements with Canada, France, Germany, Maldives, Qatar, United Arab Emirates, the United Kingdom, and the United States. All of the countries, apart from the Maldives and the two Gulf countries, are separated by quite the distance and while do not warrant an ultra-long-haul flight, it is still quite a journey to reach the U.S. from India, as an example. The opportunity was used up by a few airlines, including Vistara and SpiceJet, two Indian carriers who have never flown long-haul prior to their first odysseys to the United Kingdom.
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