The Global Aviation Industry in 2015

By / August 3, 2015



ACME

The performance of the global aviation industry has not been smooth in recent years as many people might think and most airlines, both in Africa and in the world have witnessed massive losses as witnessed with Kenya Airways that realized a loss of more than 20 billion shillings.

The global aviation industry has not been a success story in the recent years because it has been hampered by a number of factors which if not urgently addressed, the industry is likely to witness more losses in the future as is with KQ Kenya Airways.

The world has been faced with wars and conflicts and this has greatly affected the aviation industry. The war in Yemen, the fighting in South Sudan, the unrest in Libya, just to mention but a few have greatly affected the industry because there are no people travelling in and out of such war-torn areas.

People travel by plane for various reasons but the main reason is usually for business. In case of war, businesses are often greatly affected and business people are likely to postpone travelling for security reasons. War and conflict also prevent tourists from travelling to such countries.

Safety in the aviation industry is one of the most pressing challenges that have greatly affected the business in the industry. It is estimated that in 2011 alone, the number of aircraft accidents in Africa alone was nine times higher than the global average. Whenever accidents occur, apart from people losing their loved ones, airlines get massive losses through the loss of aircrafts. Aircrafts are very expensive and it takes time to recover from losses of that magnitude.

The frequency of accidents stems largely from inconsistency in the implementation and enforcement of internationally accepted safety standards and practices by most aviation companies. Accidents, despite the fact that they lead to losses of lives, they lead to huge losses on companies involved.

There is also the issue of inadequate infrastructure. The air transport industry faces various challenges including poor airport infrastructure, lack of physical and human resources, limited connectivity, and lack of transit facilities that has greatly hampered the flow of both plane and human traffic.

Although substantial progress has been made during the past decade, most airports, especially in Africa still lag behind other regions in terms of infrastructure.

Lack of sustainability has always been a major challenge. The fact is nothing is guaranteed about the future of aviation in Africa and globally if the industry is not sustainable. There is need to create a business environment that will enable the industry to be sustainable for profits to be realized.

In the past few years, the industry has not been that profitable and some airlines have even dropped out of the business. The Malaysian airline for instance is on the verge of being declared bankrupt because of the various losses witnessed as a result of accidents and unavailability of funds to run the business.

The global business too has just been hostile and not friendly to the aviation industry. The prices of fuel in the recent past have been very high and airlines have spent millions of money on fuel. In fact, fuel has been the major consumer of most airlines’ spending.

 





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