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You’re Grounded: The COVID-19 Effect on Global Flight Capacity

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10 months ago

March 18, 2020

Global Flight Capacity 6 Apr Update

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You’re Grounded: The COVID-19 Effect on Flight Capacity

It’s not an exaggeration to say that the COVID-19 pandemic has thrown the world into a tailspin.

As the number of new cases continues to surge in parts of the world, numbers are beginning to decline in others as public health officials and governments tirelessly work to slow the contagion and reach of the virus.

The potent combination of trip cancellations and country-specific restrictions on international flights has had a staggering impact on the $880 billion global airline industry. Today’s visualization highlights data from the OAG Aviation Worldwide, which tracks how global flight capacity differs from last year’s numbers.

Note: this post has been updated on April 7, 2020 to reflect the latest data.

Asia Faced the First Hard Landing

Nearly all countries have some type of travel advisory in place, with many encouraging people to avoid non-essential travel even before COVID-19 was officially considered a pandemic by the World Health Organization (WHO).

The earliest impacts of these were felt in February, as flight capacity in and out of China dropped sharply around Lunar New Year. Also, the country’s sharpest year-over-year drop was recorded on February 17, 2020, with a 71% drop in flights compared to the same date in 2019. However, there’s some good news: life in China is slowly returning back to normal, as Wuhan eases its lockdown after almost two and a half months.

Flight capacity for Hong Kong, which was already seeing its traveler numbers declining due to months-long protests, continues its slump. As of April 6, 2020, scheduled flights were down by an immense 92.3% compared to 2019—the most of any Asian jurisdiction represented in the data.

India showed one of the most drastic declines, from 1.8% down to -68% on March 30, 2020. This resulted from a 21-day lockdown order on March 24, 2020—with only four hours of notice for its 1.3 billion citizens.

Monitoring the Situation Elsewhere

Meanwhile in Europe, Italy saw a 22% drop in flights coinciding with the announcement of a national lockdown March 9, 2020. Now that the situation has intensified, flights to and from Italy have plummeted 89% from their normal rates.

Germany and Spain are seeing the highest declines in scheduled flights worldwide, with approximately 92.6% less capacity as of April 6, 2020. Flight capacity in the region has plummeted thanks to widespread restrictions.

On March 11, 2020, the U.S. enforced a 30-day ban on travelers from the Schengen Area, a free-travel zone consisting of 26 countries in Europe, and has since extended to include the UK and Ireland. As a result, U.S. flight capacity is beginning its descent, dropping 45.2% by April 6, 2020 as the ban may be extended, and to even more countries.

Meanwhile, as of March 17, the U.S.-Canada border is closed for all non-essential travel. This follows a previous announcement from the Canadian government that it would be curbing entry to only Canadian citizens, family members, permanent residents, diplomats, and Americans.

Broadly speaking, countries around the world are taking similar actions to limit the spread of the virus and “flatten the curve”:

Measure Taken	Example Countries*
Suspending flights from specific countries	🇺🇸United States, 🇹🇷Turkey
Returning citizens must enter through specific airports	🇨🇦Canada, 🇺🇸United States
Mandatory screening	🇮🇹Italy, 🇧🇴Bolivia
14 day self-quarantine	🇮🇱Israel, 🇬🇷Greece
Complete closure of borders	🇬🇹Guatemala, 🇵🇪Peru

*As of March 17, 2020

More Turbulent Times Ahead?

As both COVID-19 and the global response to it continues to evolve, here are the largest flight capacity reductions across different regions in the past few weeks, compared to a baseline from Jan 20, 2020:

Region	20 Jan 2020 Flights	23 Mar 2020 Flights	30 Mar 2020 Flights	06 Apr 2020 Flights	% Change (6 Apr vs 30 Mar)
Western Europe	18,606,424	7,595,264	3,840,536	2,476,034	-35.5%
North America	22,644,121	22,236,625	17,221,751	11,658,243	-32.3%
Eastern/Central Europe	3,701,241	1,176,139	1,930,546	1,393,600	-27.8%
Central America	2,444,383	2,040,677	1,548,458	1,135,163	-26.7%
Upper South America	1,737,713	1,011,930	673,016	513,056	-23.8%
Southeast Asia	10,866,623	6,177,093	4,810,945	3,856,977	-19.8%
South Asia	5,160,958	4,245,635	1,538,918	1,371,156	-10.9%
Middle East	4,930,030	2,580,466	1,760,809	1,619,546	-8.0%
Northeast Asia	25,278,594	13,782,879	12,465,267	11,730,667	-5.9%

Source: OAG

Naturally, the economic impact on airlines has been immense. Many airlines worldwide face the threat of bankruptcy in coming months, if these declining trends continue. To hedge against these domino effects of the outbreak, U.S. airlines are requesting upwards of $60 billion in bailouts and direct assistance from the government.

COVID-19 is throwing everything up in the air—including the fate of airline companies. It’s not yet clear when these stringent travel restrictions may be lifted, but one can only hope that these airlines do not have to continue to weather the storm much longer.

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Visualized: A Global Risk Assessment of 2021 And Beyond

Which risks are top of mind in 2021? We visualize the World Economic Forum’s risk assessment for top global risks by impact and livelihood.

Published

15 hours ago

January 25, 2021

Iman Ghosh

Visualized: A Global Risk Assessment of 2021 And Beyond

Risk is all around us. After the events of 2020, it’s not surprising that the level and variety of risks we face have become more pronounced than ever.

Every year, the World Economic Forum analyzes the top risks in the world in its Global Risks Report. Risks were identified based on 800+ responses of surveyed leaders across various levels of expertise, organizations, and regional distribution.

Which risks are top of mind in 2021?

The World’s Top Risks by Likelihood and Impact

According to WEF’s risk assessment methodology, all the global risks in 2021 fall into the following broad categories:

🔵 Economic
🟢 Environmental
🟠 Geopolitical
🔴 Societal
🟣 Technological

It goes without saying that infectious diseases have now become one of the top societal risks on both metrics of likelihood and impact.

That said, environmental risks continue to dominate the leaderboard, accounting for five of the top 10 risks by impact, especially when it comes to climate action failure.

Several countries are off-track in meeting emissions goals set by the Paris Climate Agreement in 2015, while the pandemic has also delayed progress in the shift towards a carbon-neutral economy. Meanwhile, biodiversity loss is occurring at unprecedented rates.

Rank	Top Risks by Likelihood	Top Risks by Impact
#1	🟢Extreme weather	🔴Infectious diseases
#2	🟢Climate action failure	🟢Climate action failure
#3	🟢Human environmental damage	🟠Weapons of mass destruction
#4	🔴Infectious diseases	🟢Biodiversity loss
#5	🟢Biodiversity loss	🟢Natural resource crises
#6	🟣Digital power concentration	🟢Human environmental damage
#7	🟣Digital inequality	🔴Livelihood crises
#8	🟠Interstate relations fracture	🟢Extreme weather
#9	🟣Cybersecurity failure	🔵Debt crises
#10	🔴Livelihood crises	🟣IT Infrastructure breakdown

As for other risks, the prospect of weapons of mass destruction ranks in third place for potential impact. In the global arms race, a single misstep would trigger severe consequences on civil and political stability.

New Risks in 2021

While many of the risks included in the Global Risks Report 2021 are familiar to those who have read the editions of years past, there are a flurry of new entries to the list this year.

Here are some of the most interesting ones in the risk assessment, sorted by category:

Societal Risks

COVID-19 has resulted in a myriad of knock-on societal risks, from youth disillusionment and mental health deterioration to livelihood crises. The first two risks in particular go hand-in-hand, as “pandemials” (youth aged 15-24) are staring down a turbulent future. This generation is more likely to report high distress from disrupted educational and economic prospects.

At the same time, as countries prepare for widespread immunization against COVID-19, another related societal risk is the backlash against science. The WEF identifies vaccines and immunization as subjects susceptible to disinformation and denial of scientific evidence.

Economic Risks

As monetary stimulus was kicked into high gear to prop up markets and support many closed businesses and quarantined families, the economic outlook seems more fragile than ever. Debt-to-GDP ratios continue to rise across advanced economies—if GDP growth stagnates for too long, a potential debt crisis could see many businesses and major nations default on their debt.

With greater stress accumulating on a range of major industries such as travel and hospitality, the economy risks a build-up of “zombie” firms that drag down overall productivity. Despite this, market valuations and asset prices continue to rise, with equity markets rewarding investors betting on a swift recovery so far.

Technological Risks

Last but not least, COVID-19 has raised the alert on various technological risks. Despite the accelerated shift towards remote work and digitalization of entire industries, the reality is that digital inequality leaves those with lower digital literacy behind—worsening existing inequalities.

Big Tech is also bloating even further, growing its digital power concentration. The market share some companies hold in their respective sectors, such as Amazon in online retail, threatens to erode the agency of other players.

Assessing the Top 10 Risks On the Horizon

Back in mid-2020, the WEF attempted to quantify the biggest risks over an 18-month period, with a prolonged economic recession emerging on top.

In this report’s risk assessment, global risks are further classified by how soon their resulting threats are expected to occur. Weapons of mass destruction remain the top risk, though on a much longer scale of up to 10 years in the future.

Rank	Risk	%	Time Horizon
#1	🟠Weapons of mass destruction	62.7	Long-term (5-10 years)
#2	🔴Infectious diseases	58	Short-term risks (0-2 years)
#3	🔴Livelihood crises	55.1	Short-term risks (0-2 years)
#4	🔵Asset bubble burst	53.3	Medium-term risks (3-5 years)
#5	🟣 IT infrastructure breakdown	53.3	Medium-term risks (3-5 years)
#6	🔵Price instability	52.9	Medium-term risks (3-5 years)
#7	🟢Extreme weather events	52.7	Short-term risks (0-2 years)
#8	🔵Commodity shocks	52.7	Medium-term risks (3-5 years)
#9	🔵Debt crises	52.3	Medium-term risks (3-5 years)
#10	🟠State collapse	51.8	Long-term (5-10 years)

Through this perspective, COVID-19 (and its variants) remains high in the next two years as the world scrambles to return to normal.

It’s also clear that more economic risks are taking center stage, from an asset bubble burst to price instability that could have a profound effect over the next five years.

Technology

The World’s Top Car Manufacturers by Market Capitalization

Published

5 days ago

January 21, 2021

Iman Ghosh

The World’s Top Car Manufacturers by Market Cap

View the high-resolution of the infographic by clicking here.

Ever since Apple and other Big Tech companies hit a market capitalization of $1 trillion, many sectors are revving to follow suit—including the automotive industry.

But among those car brands racing to reach this total valuation, some are closer to the finish line than others. This visualization uses data from Yahoo Finance to rank the world’s top car manufacturers by market capitalization.

What could this spell for the future of the automotive industry?

A special hat-tip to Brandon Knoblauch for compiling the original, regularly-updated spreadsheet.

The World’s Top Car Manufacturers

It’s clear one company is pulling far ahead of the pack. In the competition to clinch this coveted title, Tesla is the undoubted favorite so far.

The electric vehicle (EV) and clean energy company first became the world’s most valuable car manufacturer in June 2020, and shows no signs of slowing its trajectory.

Rank	Company	Market Cap (US$B)	Country
#1	Tesla	$795.8	🇺🇸 U.S.
#2	Toyota	$207.5	🇯🇵 Japan
#3	Volkswagen	$96.7	🇩🇪 Germany
#4	BYD	$92.7	🇨🇳 China
#5	NIO	$89.5	🇨🇳 China
#6	Daimler	$72.8	🇩🇪 Germany
#7	General Motors	$71.3	🇺🇸 U.S.
#8	BMW	$54.2	🇩🇪 Germany
#9	Stellantis	$54.2	🇳🇱 Netherlands
#10	Ferrari	$52.5	🇮🇹 Italy
#11	Honda	$46.9	🇯🇵 Japan
#12	Hyundai	$46.8	🇰🇷 South Korea
#13	SAIC	$45.2	🇨🇳 China
#14	Geely	$39.5	🇨🇳 China
#15	Ford	$39.4	🇺🇸 U.S.
#16	Xpeng	$33.9	🇨🇳 China
#17	Maruti Suzuki	$33.1	🇮🇳 India
#18	Li Auto	$29.5	🇨🇳 China
#19	Suzuki	$23.7	🇯🇵 Japan
#20	Nissan	$20.1	🇯🇵 Japan
#21	Subaru	$15.2	🇯🇵 Japan
#22	Changan	$14.6	🇨🇳 China
#23	Mahindra	$13.9	🇮🇳 India
#24	Renault	$12.0	🇫🇷 France

All data as of January 15, 2021 (9:30AM PST)

Tesla’s competitive advantage comes as a result of its dedicated emphasis on research and development (R&D). In fact, many of its rivals have admitted that Tesla’s electronics far surpass their own—a teardown revealed that its batteries and AI chips are roughly six years ahead of other industry giants such as Toyota and Volkswagen.

The Green Revolution is Underway

The sheer growth of Tesla may spell the inevitability of a green revolution in the industry. Already, many major brands have followed in the company’s tracks, announcing their own ambitious plans to add more EVs to their vehicle line-ups.

Here’s how a selection of car manufacturers are embracing the electric future:

Toyota: Ranked #2

The second-most valuable car manufacturer in the world, Toyota is steadily ramping up its EV output. In 2020, it produced 10,000 EVs and plans to increase this to 30,000 in 2021.

Through this gradual increase, the company hopes to hit an expected target of 500,000 EVs by 2025. Toyota also aims to debut 10 new models internationally to achieve this goal.

Volkswagen: Ranked #3

By 2025, Volkswagen plans to invest $86 billion into digital and EV technologies. Considering the car manufacturer generates the most gross revenue per second of all automakers, it’s no wonder Volkswagen is looking to the future in order to keep such numbers up.

The company is also well-positioned to ride the wave of a potential consumer shift towards EVs in Europe. In response to the region’s strict emissions targets, Volkswagen upped its planned sales proportions for European hybrid and EV sales from 40% to 60% by 2030.

BYD and Nio: Ranked #4-5

China jumped on the electric bandwagon early. Eager to make its mark as a global leader in the emerging technology of lithium ion batteries (an essential component of any EV), the Chinese government handed out billions of dollars in subsidies—fueling the growths of domestic car manufacturers BYD and Nio alike.

BYD gained the interest and attention of its billionaire backer Warren Buffett, while Nio is China’s response to Tesla and an attempt to capture the EV market locally.

General Motors: Ranked #7

Also with a 2025 target year in mind, General Motors is investing $27 billion into electric and fully autonomous vehicles. That’s just the tip of the iceberg, too—the company also hopes to launch 30 new fully electric vehicles by the same year.

One particular factor is giving GM confidence: its new EV battery creations. They will be able to extend the range of its new EVs to 400 miles (644km) on a single charge, at a rate that rivals Tesla’s Model S.

Stellantis: Ranked #9

In a long-anticipated move, Fiat Chrysler and Peugeot S.A. finalized their merger into Stellantis N.V. on January 16, 2021.

With the combined forces and funds of a $52 billion deal, the new Dutch-based car manufacturer hopes to rival bigger brands and race even more quickly towards the electric shift.

Honda: Ranked #11

Speaking of fast-paced races, Honda has decided to bow out of future Formula One (F1) World Championships. As these competitions were usually a way for the company to show off its engineering prowess, the move was a surprising one.

However, there’s a noble reason behind this decision. Honda is choosing instead to focus on its commitment to become carbon neutral by 2050. To do so, it’ll be shifting its financial resources away from F1 and towards R&D into fuel cell vehicle (FCV) and battery EV (BEV) technologies.

Ford: Ranked #15

Ford knows exactly what its fans want. In that regard, its electrification plans begin with its most popular commercial cars, such as the Mustang Mach-E SUV. This is Ford’s major strategy for attracting new EV buyers, part of a larger $11.5 billion investment agenda into EVs through 2022.

While the car’s specs compare to Tesla’s Model Y, its engineers also drew from the iPhone and Netflix to incorporate an infotainment system and driver profiles to create a truly tech-first specimen.

Speeding into the Horizon

As more and more companies enter the racetrack, EV innovation across the entire industry may power the move to lower overall costs, extend the total range of vehicles, and put any other concerns by potential buyers to rest.

While Tesla is currently in the best position to become the first car manufacturer to reach the $1 trillion milestone, how long will it be for the others to catch up?