Geopolitics, the Main Uncertainty for Air Transport
The powerful and constant offensive of the promoters of ecology has acted as a scarecrow on air transport, which, very unjustly attacked, has sought solutions, even if it means profoundly modifying certain aspects of this activity, such as, for example, stopping the reduction in fares. All the measures taken are not without interest because the more this sector of activity meets the criteria of good ecological conduct, the more profitable it will be. However, this requires colossal investments that will only have their full effect in the very long term, while being financed in the short term. We will not be spared from price increases to finance such complex research. But the constraints suffered by operators are only very gradually noticeable. Another factor is much more penalizing: geopolitics.
It has just been remembered since the extension of the conflict to the Middle East. Suddenly, air traffic in the region was brought to an almost complete standstill. It must be said that civilian aircraft can be prime targets when they are unable to defend themselves, and airports are important infrastructures, perfectly located, and that it only takes a single impact, even in a car park, to bring them to a standstill.
This is what happened with strikes, admittedly limited, but which hit the airports of Dubai, Doha, or Oman, to mention only the main ones. Dubai and Doha are huge hubs. They are home to the two main “hubs” in the region and among the most important in the world. So the shutdown of their exploitation has not only local and regional consequences, but also global ones. And they are difficult to replace because their efficiency is created by a conjunction between fixed equipment on the ground and two very large operators, Qatar Airways and Emirates. And these two companies operate on the entire planet.
But the consequences don’t stop there. The closure of the Strait of Hormuz immediately led to an increase in the price of oil, which has risen by 59% since December 16, when it was quoted at $58.64 per barrel, while on March 6 it rose to $93.04. This is not going to do business for air transport anywhere in the world, even if many companies have already secured their supplies, at least for the year.
And then there are the insurances. Air transport is largely covered by a battery of insurance contracts that range from the manufacture of planes to the loss of luggage. However, some events are not covered, in particular the case of weather hazards, but also armed conflicts. So customers who thought they were protected by their travel insurance are discovering that they have to fend for themselves.
And it’s not over. The rights to fly over territories depend on the will of each state, which can prohibit access at will. This is the decision of Russia, in particular, which, in response to the embargo imposed on it by the so-called Western countries, has banned all airlines from these countries from flying over it. However, Russia has the largest airspace in the world, and all flights between Europe and East Asia must fly over Siberia, and if the overflight is impossible, then it is necessary to pass through the south of the Asian continent, which extends the flight time by more than 2 hours in each direction, and each hour of flight of a long-haul aircraft such as the Boeing 777 or the Airbus A350 costs around 30,000 dollars. For a round trip, the additional cost is therefore $120,000 for Western carriers, while Chinese operators can fly freely over Russia. However, since the conflagration in the Middle East, the entire area has been declared a war zone, and it can no longer be used by carriers. You then have to go around the Arabian Peninsula to get to Asia.
It is easy to see how a conflict, even a very localized one, can have harmful consequences on the entire air transport activity. I also do not forget that the supply of spare parts and the entire widely dispersed aircraft manufacturing complex may also be affected by increases in customs duties.
Basically, we can only admire the resilience of air transport, which, even in the face of all these difficulties, nevertheless continues to grow steadily. Must the inhabitants of our planet have a furious need to travel? And that’s good.
