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  • Writer's pictureAdit Shah

COVID-19: Positive Impact of A Crisis (Part 1)

The world tends to run in cycles of economic booms followed by busts, and aerospace and space are no different. COVID-19, an ‘invisible enemy’, has forced us to put hard brakes on the global economy and has claimed more than 203,000 (as of 26th April 2020). Countless media articles and experts have talked about negative impact of this crisis on the industry and speculated how long it might last. But, in the end, we all are probing in the dark.

Nevertheless, there are always positives that can come out from a crisis such as this. For example, this pandemic will very likely accelerate and reinforce already existing trends such as more digital and paperless organisations, utilising new tools to enable rapid engineering and automation, and increasing the use of drones for cargo delivery. It is also putting into test the current industry processes – everything from supply chains and procurement to manufacturing and operations, which as a result will encourage innovation making them more robust and flexible. In this 3-part series, I explore the potential positive side-effects of COVID-19 on the aerospace and space industry.

When exploring these silver linings, we cannot ignore the effects of this crisis. Inevitably due to the pandemic, the global airline industry has taken a massive hit. Even though airlines have already started to retire aircraft early, reduced fleet sizes and operations, and furloughed employees to stay afloat, we are most likely still at the tip of the iceberg. The longer this continues, the more painful it will be for airlines, and in turn for the aftermarket suppliers, aircraft manufacturers, and other suppliers. The aerospace industry will enter a new normal once this is all over. Tim Robinson’s article on this provides a great overview of the current situation in aerospace and aviation.

The space industry has also been hit hard, with one notable impact being OneWeb filing for bankruptcy. As the space companies continue to suffer due to curtailment in their production, and with launches either getting delayed or cancelled, the space industry in general may suffer a similar fate to a greater or lesser extent. SpaceNews provides a great regularly updated timeline on what’s been going on in the space industry due to COVID-19.

There is usually a time lag between the crisis and its after effects to be felt across the supply chain. Airlines may start cancelling orders for new aircraft from manufacturers (some have already done so), and even though big manufacturers like Airbus and Boeing (even with ongoing the MAX troubles) have several years’ worth of order books, cancellations eventually will affect their manufacturing operations, and the component and assembly suppliers. Similarly, in the space industry, launch delays may force the satellite operators and their customers to bleed cash to keep operations going as much as they can without much productivity. Furloughing employees is inevitable, but is likely to offer only a marginal relief.

We don’t know for sure how long this crisis may take the industry to bounce back, and what changes it will have on individual mindset, societies, businesses and economy. But every crisis brings with it, opportunities for positive change, improving efficiencies and driving innovation.

Aerospace and aviation, both have been a huge catalyst fueling growth in globalization which we have witnessed over the last several decades. Ironically, aviation has also been a significant factor in the spread of COVID-19; and has also been one of the hardest hit industry by it. Like almost all other industries, the space industry has also been hit, although not quite as hard as aviation. Aerospace and space are here to stay, and will be stronger and better as ever from the lessons learnt from this crisis.

To quote the Black Knight from Monty Python – “Tis but a scratch”. Stay tuned for more!

Go here for Part 2.

(Featured Image Credit: Fusion Medical Animation on Unsplash)


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