Abstract
The pandemic causes social distancing and lockdown, which impedes consumer confidence and contracts the economy. Hence, this study analyzes the corona (COVID-19) impact on the airline industry revenues (ALR) and forecast by the vector autoregression (VAR) method. The results indicate that gross domestic product (GDP) and air cargo are the best predictors of ALR. The forecasting outcomes explore if ALR will decline and expect to back to pre-COVID-19 in 2023. Our results resemble both the V-shaped and U-shaped, which suggests slow gradual recovery with longer lockdown and border disclosure. The government can restore confidence building by providing economic stimulus packages and can encourage the airline to return to travel. Furthermore, softening the passenger rules concerning the refund of unflown ticket, reducing taxes, and reducing overflight taxes, all reduce the costs. Similarly, the mutually recognized global standards are crucial for effective execution, and any temporary measures taken by the government should have a clear exit strategy. The study major limitation includes the lack of relevant research and data availability.
Highlights
The world is in the midst of the corona (COVID-19) shock, which is a dark time in history, causing significant economic implications for all segments of the economy [1]
The extent of effects is unknown, and severity varies from country to country, as it affects some areas more than others
The results are like the work of Baltaci et al [30], which states that airline industry revenues (ALR) and economic growth have a strong correlation
Summary
The world is in the midst of the corona (COVID-19) shock, which is a dark time in history, causing significant economic implications for all segments of the economy [1]. The countries in this study include Australia, Brazil, Canada, China, France, Germany, Italy, India, South Korea, Japan, Netherlands, Spain, Russia, the United Kingdom (UK), and the U.S, which are amongst the top destinations of tourism and important economies of the world that contribute to employment and economic development [6] These countries are the most affected by the disease, feeling the strain of rigorous nationwide lockdowns, international bans on nonessential travel, and a dramatic drop in passengers. The current study is a useful contribution to the existing literature as follows: First, the study offers insightful evidence about the pandemic in the airline industry It is one of the first study to analyze the COVID-19 impact on airline revenues because air transport is more affected by the pandemic.
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
