Industries affected by PANDEMIC

Industries affected by PANDEMIC



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By Anushka

When the Coronavirus first started spreading in China, no one would have realized how much of an effect it would have on every aspect of human life.

As of today January 13, 2020 [WORLD]

Total cases

91.6M

+

Recovered

50.6M

Deaths

1.96M

 

no country in this world is safe from its effect and almost every country has enforced lockdowns to help contain the spread of the virus.

As most of the countries had imposed lockdowns and social distancing has become a norm, many industries have been greatly affected by the same and here we take a look at some of the Industries which are affected most by the virus.

Automobile Industry:

The automobile industry was already experiencing an all-time low and the emergence of coronavirus has just worsened its position. People were already skeptical about buying any sort of automobile, as many people prefer using the ease and hassle-free experience of using public transport.

According to economic times the onset of Covid-19 in India will have a negative impact on the automotive industry. It is estimated that there will be an overall revenue impact of at least $1.5 -2.0 bn per month across the industry.

Many experts believe that the automobile sector will recover a bit just after the lockdown is over, but to fully recover and be profitable again, it surely would take some time.

By the end of the 2021 financial year, the automobile sector might start to get back to normal but until then there is minimal chance of financial improvement in the automobile sector.

Until the time the COVID-19 pandemic is not over there is little to no chance of people stepping out of their house and buying a new automobile. However, the chances of the automobile sector recovering are there as people will prefer traveling in their own cars rather than using public transport as that would mean maintaining social distance.

Aviation Industry:

The Aviation industry is one of the worst-hit sectors due to the coronavirus pandemic, as all domestic and international flights have been canceled. There is no source of income and the cost of maintenance and preparation in this sector is huge.  Early March 2020 saw a cancellation of about 10% of all flights compared to 2019. As the pandemic grew, 40–60% fewer flight movements were recorded in late March with global flights impacted the most. By April 2020, over 80% of flight movements were confined across all the regions.

 

As per business standards , Budget carrier IndiGo, which is one of the two listed airlines along with SpiceJet in India, reported its highest ever quarterly loss at Rs 2,844 crore in the April-June quarters.

As per money control,  Airports Authority of India reported a 92% fall in revenue from Rs 2,973 cr during April-June 2019 to Rs 239 cr in 2020. CAPA India warns that the revenue impact for FY21 is likely to be over 50 percent, and job losses around 30 percent-plus.

The aviation industry is a very low margin industry and its success and revenue depend on the number of flights. Even after the lockdown is lifted the aviation industry would still not be profitable as people will not travel as frequently as they did before the pandemic.

 

There is some good news for the aviation industry as crude oil prices have gone down but this would only help them if flights are renewed and get back to the regular schedules.

Sports Industry:

Sports is an activity in which a group of people come together in a public place and compete in any game. Social distancing is the way to go now and therefore sports have taken a back seat, almost all major sporting events have been canceled or postponed.

The EURO CHAMPIONSHIP 2020, WIMBLEDON, Formula One, and every other sporting leagues have been canceled and the clubs have lost millions of dollars in ticket money during this time.

There is no aspect of sports that has remained unhinged by this pandemic, everything from the players themselves to the media houses and broadcasters everyone has been greatly affected by the same.

 

The Summer TOKYO Olympics are one of the world’s most-watched events, many players, coaches, countries, and broadcasters have much riding on the event, but even that has been pushed back by a year.

 

When the lockdown ends, sports would resume but it should be some time before we see packed stadiums as Social distancing is likely to become the new norm.

 

Eventually, traditional sports are going to get back to the top, but as of now there seems to be only despair, and chances of live sports resuming seem bleak.

 

 

Tourism Industry:

The travel and tourism industry is amongst the worst-hit industries. The coronavirus pandemic has hit the world to a very vast extent. People are stuck inside their homes and even when they are going out social distancing is a must to follow.

As people are avoiding traveling to other parts of the country, the tourism industry has been hit hard. Towns and cities whose revenue depended on tourism have been suffering the most.

Hotels and restaurant owners have been seeing a huge loss as because of the pandemic it has become impossible for them to open their hotels and get customers.

 

Worldwide, almost 50 million people who are working in the tourism sector are at risk of losing their jobs.

Local guides, hotel, and restaurant staff, local cab owners, and many more people who work in sectors related to tourism have been left stranded and lost their only source of income.

 Even airlines, bus, and taxi services all have suffered because of the virus as no one is allowed to travel.

 

A few facts and Stats:

  • As per UNWTO, The decline in the first ten months of the year represents 900 million fewer international tourist arrivals compared to the same period in 2019, and translates into a loss of US$ 935 billion in export revenues from international tourism, more than 10 times the loss in 2009 under the impact of the global economic crisis.
  • Asia and the Pacific saw an 82% decrease in arrivals in January-October 2020. The Middle East recorded a 73% decline, while Africa saw a 69% drop this ten-month period. International arrivals in both Europe and the Americas declined by 68%.
  • According to tourmyindia, In the third week of March 2020 itself, the hotel sector saw a decline of more than 65% in occupancy levels as compared to the same period in 2019.
  • Indian Association of Tour Operators (IATO) estimates the hotel, aviation and travel sector together may suffer a loss of about ?85 billion keeping in mind the travel restrictions imposed on foreign tourists.

 

Even after the lockdown is lifted, the tourism industry might not see any sort of improvement in the coming times as people will avoid traveling and would not prefer staying at hotels. 

Entertainment Industry:

The Entertainment industry has been really different than all the other ones as it is divided into two parts.

On one hand, traditional filmmakers, studios, and companies who produce movies are having a hard time shooting and releasing films. There seems to be no good news for those studios as even after the lockdown is lifted, people would avoid going to places where a group of people accumulates.

The daily wage workers who made their living by working on film sets have all been left jobless as the shooting of all films have been postponed.

On the other hand, streaming platforms like Netflix and Amazon Prime have seen an increase in the number of subscribers. It has also benefited many small filmmakers and actors who have been noticed by the general public and now have become global superstars.

 

According to Deloitte Insights survey 2020, more people (68%) now have at least one OTT subscription, as compared to those who have a pay-TV subscription (65%). And a startling statistic that stands out is that, while the Compound annual growth rate(CAGR) for OTT industry before the pandemic was around 16%, the CAGR post-pandemic is expected to be over 19%. 

 

In India, it is being observed that  Disney+ Hotstar, Eros Now, BigFlix, Hooq, Netflix, Hungama Play and some 30-odd platforms have progressed and are being watched by majority households. 

 

Youtubers are also benefiting from this lockdown as people spend most of their time online and on youtube which results in them getting more views and subscribers. The Entertainment industry will eventually get back on track as with the help of streaming platforms people will eventually see any form of art created.

Almost all industries have been greatly affected by the pandemic. The coronavirus has changed the way people live and that has affected every industry deeply. When the pandemic ends and the world slowly begins to heal, it would be interesting to see whether these industries would heal with it.


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