A pandemic issue: A grim picture of airports around the world

When I was traveling back to Kathmandu a few months ago, I had several mixed feelings. I was anxious and scared but there was a sense of relief because I was coming home! As I entered the airport in Chicago, I was welcomed by the empty airline check-in counters and I noticed very few people that were waiting in a queue for security check. The melancholic scene created a rather different experience because usually there used to be a lot of hustle and bustle at the entrance of the airport, but the COVID-19 pandemic led to strict border closures and restrictions forbidding people from traveling.

After long hours of flight and layover, I was finally able to see the Himalayas and the hills that surround the Kathmandu valley as the plane was descending into Tribhuvan International Airport. As I entered the arrival section of the airport, my COVID test report was checked and after passing through the immigration section and security check, I was waiting for my baggage. As I looked around, I saw very few people in the airport terminal. There was an unusual silence. The grim environment of the airports showed the effects of the COVID-19 pandemic on the aviation industry.

The pandemic had a serious toll on the airlines, but I will be focusing specifically on airports in this article because airports are an integral part of the aviation industry as they are a gateway to countries and cities. Airports are also important for trade and play a big role in the tourism industry.

The situation of international airports around the world

International airports around the world have seen significant drops in passenger traffic during the ongoing pandemic. Chicago O’Hare International Airport, Dubai International Airport and Chhatrapati Shivaji Maharaj in Mumbai, India are some of the popular and largest airports in the world. Chicago O’Hare International reported 538,211 passengers in both arrivals as well as departure in 2020 which is a 41% drop in passenger flow compared to 2019¹. Similar is the case with Dubai International Airport. Dubai International Airport, which is regarded as and holds the title of the world’s busiest airport has seen a 70% drop in passenger traffic with a passenger load of 25.9 million in 2020². The passenger load of the airport in 2019 was 86.4 million². There has been a significant drop in passenger traffic in Chhatrapati Shivaji Maharaj International Airport as well. Chhatrapati Shivaji Maharaj International Airport had a passenger flow of 8, 016, 456 passengers, which is a 73% decline compared to 2019 which had passenger traffic of 29, 521, 918³. The decline in passenger flow will substantially hurt the revenue of the airports due to which some airports may struggle economically post-pandemic. Tribhuvan International Airport in Kathmandu has also witnessed a similar situation during the ongoing COVID-19 pandemic.

The situation of Tribhuvan International Airport

Tribhuvan International Airport, which is the only international airport in Nepal currently saw a huge decline in passenger flow in 2020. The passenger traffic declined by 73.29% as only 1.10 million international passengers traveled through the airport, which is a loss of 3.03 million passengers whereas aircraft movement had a 68.41% decline with only 10, 247 takeoffs and landings compared to the previous years⁴. The major reason behind such a steep fall in passenger traffic and aircraft movement was the ban on international travel and a complete lockdown imposed by the Government of Nepal to control the COVID-19 outbreak.

Nepal canceled all the international flights from March 22, 2020⁵ until September 1, 2020⁶. Regular flights did not operate for more than five months. Only a few repatriation and rescue flights with prior permission from the government were able to operate. Nepal was also on a complete lockdown from March 24, 2020⁷. With the ban on international and domestic flights along with a complete lockdown, travelers were unable to enter as well as depart the country.

The decline in the number of passengers and halt on the movement of travelers led to an estimated revenue loss of Rs. 4.50 billion in the previous fiscal year⁴ and around 175,000 people lost their jobs in the aviation industry of Nepal⁶. The COVID-19 pandemic has changed a lot in terms of aviation and the future of airports and air travel which might be the new normal.

The future of airports and air travel

The new normal in the aviation industry can be challenging. One of the challenges is the reduction in business travel as many people are choosing to work-from-home or hold virtual meetings. Experts forecast that there will be a decline in business travel by more than 40%⁸. There has been a significant drop in revenue of airports. Airports generate more than 50% of their revenue from duty-free stores which have been severely affected by the pandemic as most of such stores are closed due to social distancing and sanitation reasons⁸. In the case of airports, regulators may face substantial issues. Problems such as the decline in demand leading to a decrease in revenue, higher asset servicing cost and low liquidity can be a hurdle for regulators⁸. Therefore, airports should focus on implementing newer strategies that give way to come up with innovations to make tasks easier and create a new and better normal.

This can be viewed as an opportunity as well. Some of the steps that can be taken by airports including Tribhuvan International Airport include collaborating airports with airlines by sharing data for the purpose of maximizing value which can be beneficial to both parties and the other step that can be considered is improving the current technological systems by adopting paperless systems (using Radio-frequency identification as tags for luggage and handbags and electronic boarding passes) for increased efficiency and to help monetize assets⁸. In addition to the pandemic being used as an opportunity, I believe that the vaccine against COVID-19 will be a gateway for a rise in air travel and for airports to regain the lost revenue and increase passenger traffic.

In the case of Nepal, the COVID-19 vaccine drive is in the second phase. The government has a target to vaccinate 72% of the eligible Nepalese population who are above 18 years of age⁹. The introduction of the COVID-19 vaccine around the world and in Nepal will contribute to an increase in the number of people traveling via air which will help airports get back on track. Moreover, I believe, the two newly constructed international airports, Pokhara International Airport and Gautam Buddha International Airport will be a great opportunity for Nepal to improve in the aviation sector and create the way for additional revenue generation as life gradually gets adjusted to the new normal.

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References

1. “O’Hare Loses Title of Busiest Airport As COVID-19 Brings Huge Drops In Air Traffic For 2020,” CBS Chicago, 22 January 2021. Retrieved from – https://chicago.cbslocal.com/2021/01/22/ohare-loses-title-of-busiest-airport-as-covid-19-brings-huge-drops-in-air-traffic-for-2020/.
2. Debre, Isabel. “Dubai airport sees passenger traffic drop 70% amid pandemic,” abc NEWS, 16 February 2021. Retrieved from – https://abcnews.go.com/International/wireStory/dubai-airport-sees-passenger-traffic-drop-70-amid-75898425.
3. Tripathi, Neha LM. “Covid-19 effect: Passenger traffic at Mumbai airport dipped by 73% last year,” Hindustan Times, updated on 24 February 2021. Retrieved from – https://www.hindustantimes.com/cities/mumbai-news/covid19-effect-passenger-traffic-at-mumbai-airport-dipped-by-73-last-year-101614142546255.html.
4. Prasain, Sangam. “Tribhuvan International Airport sees lowest passenger traffic since 2003,” The Kathmandu Post, updated on 19 January 2021. Retrieved from – https://kathmandupost.com/money/2021/01/18/tribhuvan-international-airport-sees-lowest-passenger-traffic-since-2003.
5. “All Nepal flights cancelled 23-31 March,” Nepali Times, 20 March 2020. Retrieved from – https://www.nepalitimes.com/latest/all-nepal-flights-cancelled-22-31-march/.
6. Prasain, Sangam. “Billions in losses and hundreds of thousands of jobs on the line as airlines industry faces pandemic,” he Kathmandu Post, updated on 13 April 2020. Retrieved from – https://kathmandupost.com/money/2020/04/13/billions-in-losses-and-hundreds-of-thousands-of-jobs-on-the-line-as-airline-industry-faces-pandemic.
7. Sijapati, Alisha. “24 March – 24 August 2020: Locked down for five months, residents of Kathmandu are taking the virus more seriously this time,” Nepali Times, 24 August 2020. Retrieved from – https://www.nepalitimes.com/banner/24-march-24-august-2020/.
8. Vasudevan S., Partner and Global Sector Lead – Airports Business, Infrastructure, Government and Healthcare (IGH), KPMG India. “Aviation in a post-pandemic world,” KPMG, 4 November 2020. Retrieved from – https://home.kpmg/in/en/home/insights/2020/11/aviation-in-a-post-pandemic-world.html.
9. Awale, Sonia. “Nepal braces for new wave with vaccine drive,” Nepali Times, 16 February 2021. Retrieved from – https://www.nepalitimes.com/latest/nepal-braces-for-new-wave-with-vaccine-drive/.