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Understanding COVID-19's Impact on the Transport Industry

Understanding COVID-19's Impact on the Transport Industry

Saturday, May 30, 2020/ Editor -  


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By Peter Mohring, Managing Director, Transport, Serco Middle East


Dubai, United Arab Emirates, May 30, 2020:  COVID-19 has presented unparalleled challenges to all businesses across the globe, but perhaps one of the most affected are those within the transport industry. No longer can we freely move people across cities, countries and continents due to the travel restrictions put in place to combat the virus. The result is a dramatic decrease in transportation revenue that is causing a range of issues in both the short and long term, from pay decreases and redundancies to closures of long-standing businesses that can’t maintain liquidity through an extended period of inoperability.

Private companies and regional governments have aligned their strategies in this critical time to deliver an unprecedented response to the global medical emergency including a record number of infection tests, screenings, temporary quarantine centres and medical facilities as well as limitation of travel whilst providing support to those unable to return home. This same level of commitment in response must continue in the thought processes and proactive development of operational initiatives and solutions that will help shape land, sea and air travel after the impact of the pandemic begins to subside.
Transport operators must at the very minimum consider the following initial changes to their operating and commercial models in order to support their clients to adapt quickly and efficiently to a new, infection-conscious way of providing a positive and efficient journey to customers.  

Fixed-cost pricing models need to transform into variable cost contracts with suppliers in order to support a relatively unquantifiable phased return to a ‘normal’ number of passenger traffic. Liquidity is one of the key issues around finances for transport organisations. Suppliers, providers and internal costs will need to be adjusted from a commercial and payment terms perspective.

The new world will require a build-up of confidence in customer’s safety as well as new ways of travelling during the re-opening stages and after the crisis. This will require companies to invest in understanding their customer’s journeys. Back-burner programmes and delayed projects will need to be accelerated, cancelled or re-evaluated against the new state of play globally.

In order to be proactive in restoring a level of normality to domestic and international travel, there are a range of new challenges that transport providers and operators must overcome. It is important to develop a suite of solutions to meet challenges such as social distancing requirements and an overall increase in travel duration.

Social distancing measures will lead to lower holding capacity on planes and trains as well as within the land, sea and air hubs and in addition, queueing will have to be reconfigured to accommodate lateral distances as well as infrastructure limitations. In order to reduce waiting times and enforce these measures, manpower requirements from suppliers will rise and passenger processing will have to be adjusted according to distance as well as lags in time to process
Travel duration will increase due to increased checks of information, medical tests and social distancing measures will increase passenger processing times as well as a decreased throughput resulting in longer lead times. Delayed onboarding and offboarding will reduce turnaround times for planes, coupled with increased time taken for luggage processing. Limited passengers for bus services and limited passengers on skybridges will further increase the overall travel duration, in conjunction to new onboarding procedures.

As one of the hardest-hit sectors by the pandemic, transport will also be one of the sectors that takes the longest time and requires the most impact to recover. Every single aspect of travel must be redesigned to achieve renewed passenger confidence in the safety of the system whilst counterbalancing the impact of increased wait times and reduced passenger carrying capacity.

Above all, a return to normal levels of passenger travel will only be achieved through the same unprecedented commitment levels shown in the initial steps taken to combat the virus. This is a time where businesses must support each other, forgoing a chase for profit and instead providing innovative, transformative and proactive solutions that will renew passenger confidence and in turn, repair the damage that coronavirus has dealt to the industry.

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