IDEAS home Printed from https://ideas.repec.org/a/rnd/arimbr/v16y2024i3p175-189.html
   My bibliography  Save this article

Financial Impact on Aviation Industry Before and During Covid-19: Passenger Demand as Moderator

Author

Listed:
  • Farra Nurdeanna Binti Saiful Nizam
  • Maryam Jameelah Mohd Hashim
  • Nur Zahidah Bahrudin
  • Nur Afizah Mohamad Arifin
  • Mohamad Harizayani Md Yahya

Abstract

This study analyses the impact of the pandemic on the financial performance of airlines, with a specific focus on financial ratios. The travel limitations imposed as a result of the pandemic, coupled with a significant decline in passenger demand, resulted in significant financial losses. This study investigates how passenger demand moderates the relationship between financial ratios and the performance of the aviation industry. This study gathered data from 20 premier Asian airline companies, as acknowledged by Skytrax. The data was collected from 2016 to 2022, with the timeframe from 2016 to 2019 designated as the 'pre-Covid19' period, and the timeframe from 2020 to 2022 designated as the 'during Covid19' period. The study uses static panel data analysis to accomplish its objective by integrating cross-sectional and time series analysis. Based on this analysis, it was determined that the company's financial condition had a substantial impact on its performance and operating worth before the COVID-19 outbreak. This influence was observed across all variables, except TATO (Total Assets Turnover). However, the company’s financial condition does not affect its performance during the COVID-19 outbreak. This is due to the implementation of government initiatives and bailouts offered some respite, while also underscoring pre-existing structural weaknesses within the business. The results emphasize the crucial requirement for airlines to implement adaptable financial strategies and strong risk management techniques to successfully navigate future disruptions. Hence, the aviation sector should embrace a comprehensive strategy centered on minimizing expenses, expanding income sources, and implementing digitalization.

Suggested Citation

  • Farra Nurdeanna Binti Saiful Nizam & Maryam Jameelah Mohd Hashim & Nur Zahidah Bahrudin & Nur Afizah Mohamad Arifin & Mohamad Harizayani Md Yahya, 2024. "Financial Impact on Aviation Industry Before and During Covid-19: Passenger Demand as Moderator," Information Management and Business Review, AMH International, vol. 16(3), pages 175-189.
  • Handle: RePEc:rnd:arimbr:v:16:y:2024:i:3:p:175-189
    DOI: 10.22610/imbr.v16i3S(I)a.4127
    as

    Download full text from publisher

    File URL: https://ojs.amhinternational.com/index.php/imbr/article/view/4127/2716
    Download Restriction: no

    File URL: https://ojs.amhinternational.com/index.php/imbr/article/view/4127
    Download Restriction: no

    File URL: https://libkey.io/10.22610/imbr.v16i3S(I)a.4127?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rnd:arimbr:v:16:y:2024:i:3:p:175-189. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Muhammad Tayyab (email available below). General contact details of provider: https://ojs.amhinternational.com/index.php/imbr .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.