The coronavirus pandemic has come as a major shock to a range of industries, and it has been especially hard for aircraft manufacturers, which have seen their orders dry up completely. On Friday, it emerged that airplane manufacturing giant Airbus had received no orders for the month of May.
Airline Stocks Soar
However, despite providing such an update for the second time in just four months, its shares actually soared. Airlines are now trying to preserve cash by canceling new plan orders. Airbus rival Boeing is going to reveal its May orders this week, and it is expected that the company is going to report no order for the fifth straight month.
It goes without saying that it is proving to be a particularly difficult time for both Boeing Co (NYSE:BA) and Airbus. Both companies have had to scale back their production schedules and have had to devise plans to remove thousands of jobs. Due to such a turn of events, the stocks of both companies sank to historic lows in March and then April. However, over the past month, the shares have rallied by more than 40%, and under the circumstance, it has come as a bit of surprise.
Richard Aboulafia, who is an aviation sector analyst at Teal Group, revealed that there seems to be optimism amongst investors that the commercial travel space is going to see a ‘V-shaped’ recovery in the coming days. However, he went on to add that he was mystified why people except for such a strong recovery in air travel in the coming months, considering the fact that the coronavirus crisis is still not over.
At this point in time, the daily passenger levels at the airports in the United States are down by as much as 85% when compared to 2019. Last week, the Transportation Security Administration conducted as many as 391882 screenings at the different airport security checkpoints across the country.