Back to the future? Airline sector poised for change post-COVID-19 By Jaap Bouwer, Steve Saxon, and Nina

Wittkamp It's difficult to overstate just how much the COVID-19 pandemic has devastated airlines. In 2020, industry revenues totalled $328 billion, around 40 percent of the previous year's. In nominal terms, that's the same as in 2000. The sector is expected to be smaller for years to come we project traffic won't return to 2019 levels before 2024.

Financial woes aside, the pandemic's longer-term effects on aviation are emerging. Some of these are obvious: hygiene and safety standards will be more stringent, and digitalization will continue to transform the travel experience. Mobile apps will be used to store travelers' vaccine certificates and COVID-19 test results.

Other effects, though, are more profound. Unlike the 2008 global financial crisis, which was purely economic and weakened spending power, COVID-19 has changed consumer behaviorand the airline sectorirrevocably.

Source: https://www.mckinsey.com/industries/travel-logistics-and-infrastructure/our-insights/back-to-the-future-airline-sectorpoisedfor-change-post-covid-19 Question 1

1.1 Global economic activity is gradually increasing with the continued rolled back of lockdown measures by governments across the world. 1.1.1 Provide an evaluation of challenges experienced by the sector due to the pandemic on the aviation industry. (10 marks) 1.1.2 Given the above, provide an in-depth discussion of implications of the developments in Eastern Europe (Russia-Ukraine war) on the aviation industry. (10 marks) 1.2 As a business consultant within the airline industry, provide an in-depth discussion of the pandemic's impact on the travel and tourism sector and the response action by governments across the world to support this sector. (20 marks)

Question 2 (20 Marks)

Sector specialists in your team previously found that some airlines were already experiencing organic challenges going into the Covid-19 crisis. Critically discuss the sources of poor performance in this sector and the extent to which the Covid-19 shock impacted them.

Question 3 (20 Marks)

Provide Actios Inc, a major investor in the airline industry, with a detailed evaluation of the fundamental shifts within the aviation industry that has arisen from the pandemic including changes in the market structure as many airlines filed for bankruptcy.

Question 4 (20 Marks)

The Nigerian government is considering various options to reduce its stake in the national airline as part of a new strategic move by the new Finance Minister. Provide a critical assessment of the privatisation option of the national airline before the announcement of the next budget statement.