(eTN) – Information filtering in from airline sources cultivated over many years from several of the countries affected by political upheavals in recent weeks all say the same thing: the aviation and hospitality industry is heading for serious financial trouble and possible serious downsizing.
Several airlines, in fact, are reportedly holding emergency management and board sessions to review their present capacity, their schedules, and equally important, their pending aircraft orders, some of which might have to be delayed or in a worst-case scenario cancelled, while hastily compiled offers are now making their way into aviation brokerages for both wet leases and dry leases of aircraft originating from this part of the world.
Route managers will also mull over how best to scale back on destinations, numbers of flights, and even use smaller aircraft, until they have weathered the rising storm, or not, of course, should they run out of money while hoping against hope. However, the uptake of such sudden capacity immediately available for the upcoming summer peak in Europe will also depend on the developments of the oil market, as sharply and continuous rises in the cost of jet fuel might seriously dampen demand for air travel in combination with planned holidays from the key European markets, themselves only just recovering from the fallout and aftermath of the global economic and financial crisis.
Egypt Air’s plight has already been specifically highlighted, but similar effects are now starting to take hold for airlines based in other trouble spots. All the Libyan-based airlines are starting to take serious occupancy hits, with, of course, a more recent accident involving many foreign passengers traveling on one of their aircraft from an African destination to their home countries, via Tripoli, not helping either in regard of passenger confidence. While frantic expatriates, similar to what happened in Cairo a few weeks ago, are camping out at Tripoli’s chaotic international airport, most are waiting to be airlifted to safety by their own home government’s chartered aircraft, and few, if any, passengers are presently flying into Libya.
The airport in Benghazi, often used as a tech stop by cargo charters from Africa to Europe – being fully loaded requires a fuel stop en route for many of the aircraft used – has reportedly become unserviceable, and the situation is at best hazy about Tobruk, ostensibly already liberated from the regime of Gadaffi, but as the country’s air traffic control is still in the hands of the regime in Tripoli it is not clear if any aircraft attempting to come in to Tobruk to fly expatriates out of that part of Libya will be granted official landing permission. Not having that, means any entry into Libyan airspace might call those sections of their air force into the skies still loyal to the regime, and it cannot be ruled out if they would not blast a passenger jet out of the skies, especially recalling the Libyan connection in the Lockerbie bombing of Pan Am and the UTA aircraft enroute to France.
In Libya, in particular, exists the strongest potential for a full-scale civil war as the liberated East of Libya is now facing off with the West of the country where the regime continues to hold on to power by using genocidal methods, mowing down protestors on the streets, and arresting “suspects” from wherever they can be found, almost certain to face torture if not worse. Egged on by a, once again, exposed ruthless despot, political madman, and now genocidaire (alleged till proven in court) Gadaffi has his goons commit crimes against humanity (again alleged till proven in court) – a major scare word nowadays for politicians running amok among their own people as they likely end up in The Hague, if not receiving eventually “instant justice” from their awakening subjects.
Tunis Air continues to struggle with low-load factors, similar to Egypt Air’s problems, as foreign tourists continue to shy away from visiting the country’s resorts along the Mediterranean shores, acting on advice from both tour operators and their home governments. Similar stories are emerging about Jordan, equally depending on tourism revenues, where the arrival rate of tourists reportedly has slowed in recent days, threatening what used to be a vibrant tourism industry. Yemen’s national airline is now also said to look with increasing concern at developments on their home political front, with daily demonstrations taking place, which will keep their passengers off their aircraft and rather connect to their final destination with other carriers. That, of course, is in addition to the terror threat already in place by Al Qaida cells and supporters operating in the country and in certain parts of Yemen almost at will.
Resorts along the Red Sea beaches of Egypt, but also those in Tunisia, are scratching their heads as to how to approach the upcoming ITB, the global tourism trade fair industry leader, and what to tell their buyers and the traveling public, and are busy strategizing to find at least a survival mode until things get better. Libya’s tourism industry, which though still in its infancy, was carefully being built up in recent years, is now equally staring at financial ruin, similar to the empty Red Sea resorts and parked Nile cruisers in Egypt, as no clients from abroad will stay there until the political situation is fully resolved and market confidence has been restored.
A slightly different picture appears to emerge, however, from some of the city business hotels in cities affected by strife, which were often reportedly quite full as expatriates stuck, especially in Libya, have resorted to divert there, hopefully being safer there than in their homes. Private homes presently are arguably greater focal points for looting, should civil order completely descend into chaos. City hotels are also easier to access in case of further mass evacuations as focal assembly points, should it become necessary. They too, however, will be empty once the exodus has been completed as no foreign business travelers are likely to travel back en masse, but for the most adventurous ones seeking to make a quick buck.
The entire Northern African region, including Morocco, which has not yet seen they kind of serious political troubles as witnessed elsewhere, is now under the spotlight by the global aviation and tourism sectors – other sectors, too, of course – to establish where it is safe to go, and this uncertainty is bound to take its financial toll on the airline and tourism sectors and delay or defer investments.
Up to now, no other country has openly wooed potential holiday makers to switch to their safe shores, but it is only a matter of time before this will begin, probably prompted by leading tour operators from Europe where crisis meetings have been taking place to decide what to do about major Mediterranean traffic flows for the summer vacations, arguably away from the trouble spots to safe destinations like Spain, which is likely to benefit from added visitors turning their back on places like Egypt and Tunisia, and likely a few more in coming weeks and months.