Dubai: Airports in the UAE would have lost around 30 per cent of their passenger traffic after the suspension of flights from India over mounting COVID-19 infection rates.
“Under the current circumstances, it is difficult to envisage when these [restrictions] will stop,” said Stefano Baronci, Director-General of Airports Council International (ACI) for the Asia-Pacific territory.
Meanwhile, repatriation flights continue to bring stranded Indian nationals and essential goods to the country. “Domestically, traffic is still going on [in India] - for such a big country, there is no substitution to air travel,” said Baronci.
The UAE had initially imposed a 10-day entry ban on commercial flights from India, but that’s been extended indefinitely. India is facing a ‘second wave’ crisis, with COVID-19 daily numbers hitting the 400,000 a day mark.
There is also the UK’s ban on all non-essential international travel – a resolution on that score will also be needed for UAE airports to get some needed bounce. (In the first three months, Dubai International Airport saw a near 70 per cent drop in overall passenger movements compared to a year ago, which was before global air travel was curtailed.)
Survival chances
As for airlines, more work will be needed to reclaim lost ground from the pandemic phase. With airlines set to lose roughly $50 billion this year due to COVID-19 restrictions on travel, consolidation seems to be the only way forward. “Airlines and airports have obligation, but also the great opportunity to strengthen their coordination to make sure that hubs can continue to enjoy a competitive advantage,” said Baronci.
“Airlines are going through a likely process of consolidation - major airlines are using hubs as their platform (and) it's an opportunity for them to strengthen and improve that cooperation.”
Major aviation hubs such as Dubai, London, Singapore and Hong Kong will “continue to flourish” as soon as the crisis is over, said the executive.
Airport charges
Airports in the Middle East and Asia have slashed their landing and take-off fees to support airlines and industry suppliers, said Baronci. However, other revenue sources are quickly drying up. “We are concerned - if the passengers are not there, it means that we cannot collect our charges and generate commercial revenues,” said Baronci.
Although cargo has taken off in a major way and is even exceeding pre-COVID-19 volumes, it represents a tiny portion of airports’ income. “The charge that you set for transporting freight is very different from passenger charges,” said Baronci.
The key component of the revenue is from shops and retail outlets in Dubai and many other airports.
