For an industry already struggling with the unpredictable cost of fuel, over-regulation, nationalistic obstacles and criticisms from climate activists, the coronavirus is the cruellest - and possibly fatal - blow.
A dramatic fall in demand resulting from unprecedented border shutdowns across the world to contain the pandemic is threatening to take out almost half the global carriers, according to some estimates.
As Mr Shukor Yusof of aviation-centred Endau Analytics tersely notes, all this seems surreal, given that just three months ago, in December last year, the International Air Transport Association (Iata) was expecting the airline industry to register a net profit of US$29.3 billion (S$42.3 billion) this year.
"The industry was to have posted its 11th consecutive year of profitability this year," Mr Shukor, the managing director of Endau Analytics, points out. "Who could have foreseen the speed with which Covid-19 overturned the sentiment towards air travel in the past fortnight, leading Iata to revise its positive forecast to a staggering loss of US$113 billion for 2020?"
As late as November last year, the biggest challenge the industry was facing was the loss of environmentally conscious passengers to other modes of transport claiming lower emissions.
Over the past year - just as fuel costs seemed to be supportive of growth - the industry was being lambasted by climate activists led by Swedish teen environmentalist Greta Thunberg for its carbon emissions. The growth of flygskam, or flight shaming, has seen thousands of European travellers migrating from planes to trains for travel. Airports in the Nordic regions and Germany have seen a marked decline in travellers over the past year, while train stations have been filling up.
Still, the past few years have generally been good for airlines on the back of strong and steady demand for air travel. Yields have also held up, thanks to muted fuel prices and a growing appetite for premium seats. As a result, the financial numbers have been quite robust. Revenue per passenger per kilometre, or RPK (the common measure of top-line income), has risen just over 6 per cent year on year since 2017. Net profit growth for global airlines as a whole rose by between 4 per cent and 5 per cent annually during the past three years. Profit margin has stayed at around 7 per cent of total revenues since 2017, delivering a return on investment of just above 8.5 per cent.
The situation today is starkly different.
BIG NAMES GROUNDED
Top-tier global names like Qantas, United Airlines, British Airways, Cathay Pacific, Korean Airlines, KLM and a dozen others have all but grounded their entire fleets. Staff and crew have been furloughed, and forced to take partial or no-pay leave. Given the disappearance of demand and the cash-flow crunch, many regional discount and low-cost carriers may never see the light of day, even after the pandemic is over.
Jetstar Asia has grounded its entire fleet for the next three weeks, while, in Europe, Easyjet and Ryanair are doing the same. Britain's FlyBe is already history.
Even erstwhile stronger players like Singapore Airlines are struggling to maintain positive cash flow. There is a very real danger that the iconic multiple award-winning carrier's gearing will hit its upper limits by next month, forcing it to go cap-in-hand to the Government for funding. The airline has been forced to cancel scores of flights to China, North-east Asia and Europe, while its senior management is taking huge pay cuts, as many of its crew are furloughed at home.
Just north of the border, Malaysia Airlines was already looking for handouts in the region of RM1 billion (S$330 million) annually to stay afloat. Covid-19 could simply be the straw that breaks its back.
To say this is the worst crisis ever for the industry would be a huge understatement.
This is how the Sydney-based aviation think-tank Centre for Aviation (Capa) put it: "As the impact of the coronavirus and multiple government travel reactions sweep through our world, many airlines have probably already been driven into technical bankruptcy, or are at least substantially in breach of debt covenants. Cash reserves are running down quickly as fleets are grounded and what flights there are operate much less than half full. By the end of May 2020, most airlines in the world will be bankrupt."
Iata has just released an updated report noting that beyond the top 30 players, all other airlines have weak balance sheets, high debt and barely enough cash to cover three months of operations.
In short, most of the world's airlines could be bankrupt by June.
Coordinated government and industry action is needed immediately if a global aviation catastrophe is to be avoided. American carriers are already asking for over US$50 billion from Washington. Germany and half a dozen other countries have also indicated they will provide financial lifelines to their carriers.
And they should.
Aviation, like it or not, is the lifeblood of global commerce and connectivity. Yes, it has serious issues to address on the carbon emissions front. Serious efforts are being made to address these through alternative fuels, more efficient engines, carbon offset markets, electric power systems, fuel-saving routings and emission taxation.
Also, this is an industry ruled by archaic and nationalistic ownership and air rights laws established some 75 years ago which prevent market access, mergers and consolidations like in many other industries.
But all that could change if half the players actually disappear. Indeed, post pandemic, most governments could place higher priorities on saving their economies than saving their airlines.
The fate of the aviation industry can be likened to that of Sisyphus, a legendary king of Corinth condemned eternally to repeatedly roll a heavy rock up a hill in Hades, only to have it roll down again as it nears the top.
Indeed, this is a business that has had its fair share of ups and downs. Good years have quickly been followed by bad ones, often due to factors well beyond the control of industry players. These have ranged from pandemics and terrorism, to sky-high fuel costs and charges, labour dissent and protectionism.
Nobody knows when this pandemic will pass. Given their thin margins, negative cash flow and significant debt, even three months (which is the most optimistic forecast so far) will be too long and too late for many.
And it is not just airlines which are tottering.
Plane deliveries to the erstwhile vibrant Asia-Pacific market has collapsed, according to Cirium Fleets data. Planemaker Boeing's stock has lost over 60 per cent of its value since January, and is looking for a US$60 billion bailout. Meanwhile, its European rival has drastically cut back production.
This crisis will also hit airports and travel infrastructure projects being rolled out across the world.
The knock-on impact on the financiers of these mega projects is yet to be known.
Then there are other players down the supply chain ranging from logistics and ground handlers, to avionics and aero-engineering players who will be impacted.
Sars cost the global economy some US$40 billion. But Sars was largely confined to the Asia-Pacific region, with China and Hong Kong at the epicentre. According to Iata estimates, Asia-Pacific carriers lost US$6 billion during the period. US carriers probably lost US$1 billion.
A lot has changed since, and not just because Covid-19 is a global pandemic which has spread much farther and faster.
It has simply escalated the crisis to a devastating new level for airlines, the travel industry and the entire related supply chain. Analysts estimate that the lockdown of Europe, US, India, China and other markets could lop off over 50 per cent of global demand for air travel.
This means the forecast of US$113 billion loss was on the optimistic side - a point that Iata has just acknowledged this past week.
Its latest estimate is closer to a US$130 billion loss.
Stressing the gravity of the situation, Iata director-general Alexandre de Juniac has asked governments to act quickly to save the industry: "Time is of the essence. Governments cannot take a wait-and-see approach. We have seen how dramatically the situation has deteriorated globally in a very short time. They must act now and decisively."
The irony of ironies is that this is coming as fuel prices plunge to their lowest levels since the early 1990s, following Saudi Arabia's decision over the weekend to flood global markets with the black gold in response to the Russia-driven breakdown of Opec+. But cheap fuel in an era of low (or no) demand is not - to put it mildly - useful.
Mr Brendan Sobie of Sobie Aviation notes that the low oil price is, in fact, hurting airlines: "For FY2020/21, SIA is hedged 51 per cent for jet fuel at US$74 per barrel and 22 per cent for Brent at US$58 pbl. The group will incur over US$1 billion in hedge losses for the financial year beginning April if fuel price stays below US$30 pbl."
The only segment of aviation that is intact is the private jet business, which has seen more demand as some moneyed folks avoid airports.
If there is any light at the end of the tunnel, it seems rather dim and distant for the distressed aviation industry. But hopefully the survivors - largely those bailed out by governments - will emerge stronger, wiser and more efficient than before. Hopefully, some of the archaic laws governing the industry will also be a thing of the past.