COVID-19: Island nations' serious loss of air services. Part 1
When the General Manager of Atlanta Hartsfield-Jackson International Airport, the world's busiest, reports an 85% year-on-year decline in passengers since the coronavirus outbreak, says revenue could be down by 50% or more, and that the airport normally services 26,000 flights per day but it has decreased to 1200, and "those flights are mostly empty"- you know that the aviation industry has a big problem.
But at the other end of the scale from Atlanta, in the world's small island states, particularly remote ones, for which air travel is an absolute necessity, it is much more of a problem.
An island state is a country whose primary territory consists of one or more islands or parts of islands. Broadly 25% of all independent nations are island countries.
This report looks at a selection of those states and airports, and at how they have been impacted by the COVID-19 outbreak.
- The COVID-19 outbreak has severely impacted the aviation industry, with airports experiencing a significant decline in passenger numbers and revenue.
- Island states heavily reliant on air travel, such as Iceland, Greenland, and the Faroe Islands, have been particularly affected due to their remote locations.
- Malta and Cyprus, which heavily rely on air travel for commercial purposes and tourism, are facing challenges as their national airlines suspend operations.
- Norway's remote settlements and overseas territories, such as Svalbard and Jan Mayen, heavily rely on air transport for connectivity, making it essential to keep airports open.
- The Azores, Bermuda, and Cape Verde, which heavily rely on tourism, are facing significant disruptions as airlines suspend operations and travel restrictions are imposed.
- South Pacific islands like Fiji, Samoa, and Vanuatu, which heavily depend on tourism, are also experiencing a complete halt in international air travel.
Summary
- All European services via Iceland into North America are currently suspended. The Faroe Islands is effectively cut off by air. In Greenland air transport is the only way of getting from one settlement to another - by plane or helicopter.
- Malta is heavily reliant on air travel for commercial purposes, to support Maltese exporters, and to underpin the tourist industry. Cyprus is in a similar position to Malta, also reliant on tourism; it has no airline of its own, and so is reliant on foreign ones.
- Norway: Avinor moved quickly to close nine airports to focus resources, but Svalbard has to be kept open as there is no practical alternative method of getting there. Moreover, it lies on intercontinental polar routes for emergency diversions. Remote settlements in northern Norway are heavily reliant on air services.
- TAP Air Portugal has taken steps to provide for Portuguese autonomous regions (The Azores, Madeira). Cape Verde: Cabo Verde Airlines (CVA) has suspended all its transport activities for a period due to the decision to close the country's borders.
- Bermuda: 75% of tourists are from the U.S. and deep cuts have been made by inbound airlines. Bermuda's international financial sector businesses should see it through the immediate future.
- South Pacific islands tourist-dependent and also heavily impacted by the COVID-19 coronavirus outbreak and its impact on air services.
Iceland, Greenland and the Faroe Islands - Nordic isolation
Looking to Europe first: a good place to start is Iceland, population 330,000, because of the huge growth in tourism there, which 'saved' the country from the havoc wrought on it by the banking sector, and because its national airline is as reliant on transit traffic between Europe and North America as it is on point-to-point Iceland traffic. All European services into North America are currently suspended.
Traffic at the country's main gateway, Keflavik Airport, was already down by 30% in Jan-2020 as a continuing result of the loss of WOW Air services last year, and consolidation of services by Icelandair.
Schedule data for week commencing 23-Mar-2020 shows that Icelandair's total seat capacity for the week at Keflavik is just 76,165 or 10,880 a day. As its Boeing 757 aircraft have 184 seats that is 59 services a day, in and out, with the focus very much on Europe and with the maintenance of the Icelandic economy, which relies heavily on imports, an essential requirement.
Reykjavik Keflavik International Airport seats by airline, in week commencing 23-Mar-2020
To that end, Icelandair Cargo flights are an even more essential part of the company's mix at the moment. Usually, their main purpose is to deliver fresh fish across Europe, now they have another, equally vital role to replace lost passenger aircraft belly-hold space to bring much-needed goods inbound.
The airline continues to promote tourism however it can, with special fare offers being pushed through social media. That is an unusual situation anywhere in Europe, and any visitor risks being quarantined in appropriate circumstances. On the other hand, the economy is now very heavily reliant on tourism, more than it should be, and that is something of a Catch-22.
The Faroe Islands, a semi-autonomous Danish territory of 50,000 to the southeast of Iceland, is in a worse position, being effectively cut off by air.
The national airline Atlantic Airways had only just announced (24-Feb-2020) a new service to London Gatwick airport for summer 2020 in a belated effort to boost tourism when it called time on seven services (but not Copenhagen), from 14-Mar to 13-Apr - a date that is likely to be extended. Without air services, the Faroe Islands are also accessible by sea to supply essential provisions, but the process is a much longer one.
Greenland, another semi-autonomous Danish territory, is a much bigger landmass, albeit mainly ice other than a thin strip along the coast, but the population is even smaller, some 40,000, and they are well spread out across it. Air transport is the only way of getting from one settlement to another, by plane or helicopter.
Two airports - the capital city airport, Nuuk, and Ilulissat - handle domestic flights, and the 'international' ones (principally Copenhagen, although Air Greenland has designs on North American services) are at Kangerlussuaq, which also handles cruise ship passengers.
Approximately half of services were cancelled on 26-Mar, according to airport websites, but those shown to be operating may be emergency flights. As with Icelandair, Air Greenland, which has notified a total cancellation of normal services from 20-Mar to 08-Apr, has a vital role to fill as a cargo airline with its single A330 aircraft.
Malta and Cyprus - the importance of having your own national airline, however small you are
Malta, in the Mediterranean Sea between Italy and Africa and with a population of around 500,000, is heavily reliant on air travel for commercial purposes, to support Maltese exporters, and to underpin a tourist industry which has grown in recent years to encompass adventure tourism and conferences (although there are very few of those just now, anywhere), apart from regular 'sun vacations'.
The two main airlines are Air Malta and Ryanair, whose subsidiary Malta Air was scheduled to take over its routes there this summer. Just about all Ryanair services are suspended from 24-Mar and Air Malta had already announced plans to suspend all commercial operations from 20-Mar-2020 "until further notice", by order of the Maltese health authorities.
Air Malta will instead operate a 'lifeline schedule' to facilitate outbound travel for stranded individuals to their home countries and ensure essential connectivity for critical medical cases, apart from medical equipment and medicines to the Maltese islands. The airline will introduce a new schedule operating to London, Paris, Amsterdam, Brussels, Frankfurt, and Vienna, subject to demand.
This was the planned capacity schedule at Malta International Airport for the week commencing 23-Mar-2020. It will have altered radically with cancellations by most of the airlines.
Malta International Airport seat capacity by airline, week commencing 23-Mar-2020
Cyprus is in a similar position to Malta's, a trading nation which sits between regions and continents and which is also reliant on tourism. It has no airline of its own, and so is reliant on foreign ones, and especially Wizz Air. The seat capacity schedule for week commencing 23-Mar-2020 is replicated below at the main Larnaca Airport.
Larnaca International Airport Glafcos Clerides seat capacity by airline, week commencing 23-Mar-2020
The similarity of Cyprus to Malta is evident in the fact that Qatar Airways is (or at least was) continuing to operate a service to Doha, if only for transiting passengers, as no entrance is allowed in Qatar.
The lack of reliance on a home-based national carrier may turn out to be beneficial as long as foreign airlines continue to operate, but as of 21-Mar-2020 no less than 29 countries (including Qatar) have indicated that flights to Cyprus would be curtailed for a period of 14 days, with the exception of cargo flights.
Norway has to protect its communities on the mainland and almost at the North Pole
Even larger, economically powerful countries can find problems arising at airports in such circumstances.
Take Norway, for example. It is not an island, but it does have very remote overseas island territories at Svalbard and Jan Mayen, in the Arctic.
The latter has very few inhabitants, mainly government scientists, but Svalbard, which is physically as big as Norway and as far away from Oslo as Libya and Uzbekistan, has a population of 2,670.
Svalbard Airport, at Longyearbyen, is the main airport and is the northernmost airport in the world with scheduled public flights. It is owned and operated by state-owned Avinor. It is served by both SAS and Norwegian.
Avinor moved quickly to close nine airports in order to focus resources on the main ones, but Svalbard has to be kept open as there is no practical alternative method of getting there. Moreover, it lies on intercontinental polar routes for emergency diversions.
But is it not the case for other airports on the mainland? Anyone who views the online flight portal flightradar24.com and who looks at northern Norway late at night will know that there is normally a myriad of flights operated by SAS and Widerøe, flying between the main towns.
This image was taken at 17:50 Central European Time on 26-Mar-2020. Almost all the aircraft are SAS and Widerøe with the exception of one operated by Norwegian. They are flying to the capital or major centres of population, or just connecting towns that might be only 100 miles apart.
Flightradar24.com, image of flights operating in northern Norway: 1750 hours central European time, 26-Mar-20
The reason is simply that the alternative - road and ferry travel - is extremely time-consuming and not suitable for daily business, let alone emergency situations.
Many of these routes are likely to be public service obligation (PSO) routes where financial support is offered by the government.
The changing situation even impacts on quite major airports such as Tromsø, which is the northern gateway airport offering transit to and from several other airports in the area, including those serving the Lofoten Islands, a tourist haven. It is dominated by SAS, Widerøe and Norwegian, with over 90% of the capacity between them.
Services are still operating there, as this snapshot of live flight departures at 18:00 Central European time on 26-Mar shows. The cancelled flights are the night-time ones, after 21:20.
Snapshot of flights operating, Tromsø: 1800 hours central European time, 26-Mar-20
Of the islands and island groups in the Atlantic Ocean, three are selected here: the Azores, Bermuda, and Cape Verde. All are reliant to varying degrees on tourism.
TAP Air Portugal takes a positive line
The Azores is a group of Portuguese islands around 1500 km from Lisbon, which is as far as the Canary Islands are from Madrid and without the benefit of a nearby Africa landmass, and 2,500 km southeast of Newfoundland in Canada. That's isolated.
The Azores is one of the two autonomous regions of Portugal, along with Madeira, an archipelago composed of nine volcanic islands. The traditional industries of agriculture, dairy farming, livestock, and fishing are being overtaken by tourism, which is becoming the major service activity (in Madeira it already is).
Three airlines operate at the main airport, Ponta Delgada - TAP Air Portugal, SATA Internacional (Azores Airlines) and Ryanair, with the latter having 64.8% of seat capacity in the week commencing 23-Mar-2020. According to CAPA/OAG data, there is no capacity for SATA/Azores Airlines.
That is a problem because Ryanair, which has a base at Lisbon Airport, is about to suspend all flights on its entire network, leaving only TAP here.
In the week commencing 23-Mar-2020, there were only 3,000 seats compared to 35,500 in the previous week.
Ponta Delgada (Azores) João Paulo II Airport weekly total seat capacity, 2017-2020*
The national airline has, however, taken a very positive approach to the current situation.
In a statement on 19-Mar-2020 it announced a "significant reduction" in operations following successive announcements of restrictions by several governments in markets where TAP operates, combined with the sharp drop in demand, but that it will ensure services "on all possible routes, in order to ensure its mission of carrying its customers to their families".
Its CEO stated: "We are working on the continuity of our business, confident that we will return soon to our usual pace of activity, always focusing on the future, sustainability and growth of our TAP".
Presumably, it will focus remaining activities on sustaining the islands, and this is one of the main reasons why, unlike the situation in Cyprus for example (and potentially in Malta, where the value of the national airline has been questioned in the past), there is great value in retaining a national carrier in case a 'known unknown' should materialise like this.
Bermuda better placed to ride it out
Bermuda, a British Overseas Territory with a population of 70,000, lies 3,600 km to the west of the Azores, and about 1,000km off South Carolina in the U.S.
It is far better positioned economically to survive the current situation than are most of the other islands mentioned here. Bermuda's largest economic sectors are offshore insurance, reinsurance, and tourism.
But 75% of tourists are from the U.S., compared to just 8% from the UK, which spells problems in the longer term if travel bans and service cuts continue for any length of time. Deep cuts have been made by American, JetBlue and Delta and the number of seats fell in one week from 17,400 to 6,500.
Bermuda LF Wade International Airport, weekly total seat capacity: 2017-2020*
Nevertheless, Bermuda's international financial sector businesses, which can work their way around a serious downturn in travel, should see it through the immediate future and as far as supply issues go, one would expect the UK government to ensure continuity as far as possible.
Cape Verde's tourism growth is threatened
Further to the south and off Africa's Atlantic Coast lies the multi-island archipelago that is Cape Verde, an ex-Portuguese colony which retains good relations with that country - as indeed it needs to right now, for it is heavily reliant on tourism.
It would be fair to say that islands like Sal and Boa Vista are almost totally reliant on tourism, while government and commerce do play a role in the major centres of the capital (Praia, on Santiago Island, and Mindelo, on San Vicente Island).
Cape Verde in relation to the African coast
After years of languishing in a state of limbo, the national airline Cabo Verde Airlines (previously TACV) has been revitalised by its 51% shareholder Icelandair Group. The group has tried to retain CVA's responsibilities with regard to the country's extensive diaspora while introducing new markets and feeding traffic through a hub, in the same way as Icelandair does in the North Atlantic.
On 17-Mar-2020 CVA suspended all its transport activities for a period of at least 30 days due to the decision by the Government of Cabo Verde to close the country's borders.
That is undoubtedly a serious situation for the country, although domestic flights (operated by Binter Canarias) appear to be continuing, along with international cargo flights. Improved harbour facilities at Praia and Mindelo, and small harbours on all the islands, mean that there are alternative facilities for necessary imports.
Some South Pacific islands are highly tourist-dependent
In the South Pacific Ocean, Fiji's Nadi Airport was officially shut down to all scheduled passenger travel from 26-Mar-2020 other than evacuation services.
Vanuatu initially only temporarily closed Port Vila Airport international terminal on 23-Mar-2020 and reduced the operating hours of Port Vila Airport, Santo Airport and Tanna Airport. More stringent measures are sure to follow, if they have not done so already.
Fiji has one of the most developed economies in the Pacific due to abundant forest, mineral, and fish resources, but the main sources of foreign exchange include the tourist industry, and that will fall to zero for now.
Vanuatu is in a slightly better position. Although tourism is again a large part of its economy, there is a substantial fishing industry and offshore financial services.
Meanwhile, the Government of Samoa amended its State of Emergency Orders on 24-Mar-2020 to suspend all international air travel to Samoa, effective 26-Mar-2020.
Location of Fiji, Samoa and Vanuatu
Not a good time to be in Comoros
If you are searching for the country most likely to be hardest hit, then Comoros, in the Indian Ocean between Mozambique and Madagascar, must be in the running.
Comoros is politically unstable at the best of times and has suffered many coups d'etat. There is gross income inequality among the one million population, which is a major reason that whatever government is in power today will not want the virus at all.
Comoros has been trying hard to promote tourism, but it is an eclectic mix of airlines that serves the island at the best of times.
They include the local AB Aviation, Ewa Air (owned by Air Austral), Interamericano (Colombia, about which very little is known but it has a capacity of 297 seats in the week commencing 30-Mar-2020), Madagasikara Airways and, most importantly, Kenya Airways, which gives the island a genuine link to the outside world. Take that link away and Comoros will struggle.
As it happens, the number of seats has only just slightly more than halved compared to 2019, and there is typically a dip in supply at this time of the year.
Moroni Prince Said Ibrahim International Airport weekly total seat capacity, 2017-2020*: week commencing 30-Mar-2020
'Public Service Obligation' will take on a new meaning
Very often, air services between, to, and from these islands will be operated under a form of public service obligation route scheme, where the government ensures a route(s) is sufficiently financed that it can operate, subject to certain conditions such as reliability and frequency, and within price parameters. That does not mean that outright tourist routes are protected but sometimes they will be.
What it does mean is that critical supply routes can be reinstigated fairly quickly once it appears safe to do so.
But such is the scale of this event that it seems that most countries in the world, let alone these remote islands, are going to need public support of such routes when such support comes to an end, and probably for a very long time.
CAPA MEMBERS - Stay up to date with the latest critical global developments affecting the industry with our customisable CAPA Alerts. Please contact our Sales Team for assistance.
MEDIA - If you are seeking further commentary on this topic, please contact our Marketing Team.