If you look back a bit, you will notice that 2017 was a big year for start-ups. Start-ups in 2017 weren’t just doing the same thing and weren’t all located on the same continent. African start-ups like Fastjet Mozambique, Indian commuter airlines like Air Deccan, IAG subsidiary LEVEL and Chilean success story JetSmart: you name it, over 100 new airlines started operations in 2017. This year, we have only had 2 start-ups. Why is that the case? Could it be that there has been a sharp downturn in demand? Or could it be the roots of an upcoming financial crisis? Let’s go back to 2017. Even though many airlines were surging out of their lairs, we also saw giants like Monarch and Air Berlin tumble into the large lagoon of bankrupt airlines. The Euro was not doing very well back then (it’s doing even worse now), morale was low and Brexit was getting everybody up in arms. Although these subjects do not have a direct link with the aviation industry, they have an impact on people’s financial choices. Many people panicked and started selling everything, whereas others decided that this was the right time to flood the market, and to create businesses. Those who started investing in the aviation industry and setting up new airlines got crucified and those who didn’t… well, let’s just say that they made the right decision. It is also obvious that people started creating new airlines in 2017 because they thought that they had found a “niche” in the market and that it was the right moment to come in. Coronavirus proved them wrong. But the most interesting dimension of this sudden uproar of interest in the market is more philosophical than financial. Did everyone have the same idea at the same time… or was it just a little wave of joy before the crash? If you wish to give you own input, please reply by commenting in the comments section. Thank you for reading this article. McCloud, 28th of May 2020.
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