- [Narrator] The Boeing seven 477,
it's the jumbo jet that made long distance travel
more affordable and was the crown jewel of BOAC fleet.
A company you may now know as British Airways.
- [Announcer] By the end of the year BOAC will have extended
it's jumbo services around the world
on most of it's key routes.
- [Narrator] But in 2020, after five decades,
BA has decided to bring forward its plans to retire the 747
as have other airlines like Qantas and Virgin Atlantic.
It's a visible sign of how airlines are having to quickly
transform themselves to survive the coronavirus pandemic.
- The industry has been decimated.
- [Narrator] Passenger volumes dropped an unprecedented 95%
in April, and the industry is set to lose $84 billion
this year alone.
A number of airlines around the world
have already gone bust.
- It's a little bit like the game of survivor.
We don't know how long the downturn is gonna last.
- [Narrator] So to stay in business,
airlines have to move quickly
and face make or break choices
at a time of zero visibility.
A first critical choice is whether or not to keep flying,
and where to send those planes when demand is so low,
flying too many planes means losing money,
but flying too few means missing out on passenger demand
and potentially losing market share.
- Getting that balance right, is absolutely crucial.
How can I stay in that market?
How can I continue to be active,
but not fly unnecessary journeys with empty aircraft?
So many airlines, that's the great dilemma.
- [Narrator] Airlines in the US
are going about it in very different ways.
- American has said,
we're gonna take as many people as we can,
pack them into the airplane,
reduce our cash losses each day.
There are some people who need to travel.
There are some people who wanna travel, so let's get them,
let's get them all.
- [Narrator] But Delta has said,
it's going to have the number of planes it's bringing back,
leaving its capacity around a 1/4 of what it was last year.
- Taking flights out of your schedule
does help you save cash.
It certainly reduces your, your daily operating costs.
And it's quite simple
if you only have enough passengers for one or two flights
a day, you only wanna be flying one or two flights a day.
- [Narrator] Striking the right balance
is particularly difficult.
And airlines can't even rely on their usual forecast data.
As few customers are planning travel ahead of time.
- They've lost all of their historic data
around booking demand.
When people book for what routes,
how far in advance, and how much they're prepared to pay.
(upbeat music)
- [Narrator] That makes another crucial decision
particularly pressing, whether or not to keep their staff.
- If you're talking about 50% of the world's fleet,
being grounded at this moment in time and 50% of the world's
capacity not flying at this moment in time,
you don't need to be a rocket scientist,
I mean, that probably means 50 of people employed
in the aviation industry
are not gonna be required certainly through the winter
of this year.
- [Narrator] While carriers like Cathay Pacific
and Hong Kong have asked their employees
to take unpaid leave,
others like Emirates have laid off staff.
In the US airlines that accepted government money
under the cares act promised not to lay off,
or furlough workers until the end of September,
but have looked for other options.
- What they're asking from employees
and labor is usually
their number one or number two costs.
They're asking for forgiveness voluntary leaves,
working fewer hours than what's guaranteed
in their contracts.
Different relief forms like that.
- [Narrator] American has worn 25,000 of its staff
that their jobs are at risk once funding expires.
And United said, it's exploring shedding 36,000 employees,
nearly 1/2 of its US workforce,
but furloughing, specialized workers
can have longterm consequences.
- You don't wanna furlough a pilot
for just a couple of months
and then have to bring them back
for a couple months of training,
and you don't wanna create training cycles
where you just jam up your facilities
and you can't get the people train
that you need to get trained.
There are only so many hours in the flight simulators.
(upbeat music)
- [Narrator] Back to those 747.
- [Announcer] The jumbos cruising speed up 625 miles an hour
makes relatively short work of the Atlantic flight.
- [Narrator] Huge planes like these,
which can sometimes carry more than 500 passengers
have become difficult to fill.
As few people are flying around the world,
and Boeing has said it will stop producing the 747
altogether in 2022.
- The 747 is an expensive plane to fly.
Four engines are always more expensive than two engines.
And the reality is the bigger older planes
are the ones that don't make sense anymore.
- [Narrator] But it's not just a matter of cost.
The retirement of so many,
747s reveals a much deeper change.
- The aircraft was designed
and it has been used most recently
with quite large proportions of first
and business class seats.
Now the one thing that is not coming back,
and it's certainly not coming back quickly
is corporate demand.
- [Narrator] Delta CEO, Ed Bastian told analysts,
"He didn't expect corporate flying to ever recover
"to its pre pandemic level."
- You can often cover the cost of a flight,
just filling the business class seats,
and then everything else in coach is profit.
But if that's not the case business travel,
doesn't come back.
Then what do you do.
- [Narrator] In just a few months?
What had been a steadily growing sector for decades
has become a huge loss making business for airlines,
and the choices they make now,
will likely change the way we fly for years to come.
- Do they have the confidence
that they're gonna call it correctly?
You know, do we know what's gonna happen in the future?
It would be a brave call for any airline
to make such a dramatic change of position
in the market so quickly.
(soft music)