How Covid-19 Interfered the Economics of Cargo Operations?

AVIATION ECONOMICS QUESTIONS
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Aviation Economics Questions
Question One
The airline industry is one of the sectors that has previously been dismissed as unproductive for investors. However, recently, the sector has stabilized and appears promising. The key drivers of growth in this industry include the rising passenger demand and a rebound in cargo volumes. As the travelers increase, so does the number of airlines because of demand. Second is improvement in operational metrics. When an industry’s operating margins improve, traffic is bound to increase. Third is the high load factors that drive revenue. An increase in the operational costs imply that companies will seek for alternative approaches to maintain a high load capacities, which in turn create an avenue for more traffic. Finally, the alternative revenue opportunities that support the sector also lead to more traffic as people have more disposable income.
The North American and Asian markets are expected to grow the fastest in the medium term compared to other regions because of their significant domestic markets. The current pandemic has affected air travel, like any other industry and as countries limit travels, domestic travels are likely to remain active. Therefore, by virtue of having active domestic markets, North American and Asian markets will grow faster. Besides, these markets have received significant government support to provide temporary relieve until the travel demand resumes. The main factors that may inhibit this growth is if the industry will remain exposed to the effects of the pandemic and if the governments experience the effects and withdra...