What will a new US administration mean for the aviation industry?
As Joe Biden’s inauguration as the 46th US president approaches, many in aviation wonder what the new administration has in store for the sector. Ilaria Grasso Macola looks at how Biden might shape US aviation policy around matters such as Covid-19 relief, security and the environment.
After an election campaign lasting almost 20 months, former US Vice President Joe Biden has won the 2020 US election, beating Donald Trump and thus becoming the 46th President of the United States.
As Biden’s inauguration – scheduled for 20 January – draws closer, many wonder what the new administration’s first steps will be and what will be at the top of the President-elect’s agenda.
While aviation wasn’t the key focus of his presidential campaign, Biden did pledge to help the sector get back on its feet after the hard blow it received from the Covid-19 pandemic.
In his environmentally focused manifesto, Biden also promised to foster the development of low-carbon aviation technologies and reduce the costs of biofuels as part of his commitments to reduce greenhouse gases by 2050.
As he prepares for the White House, how will Biden shape US aviation policy and how will it affect the sector over the next four years?
Biden and the future of US aviation
According to Atmosphere Research Group airline analyst Henry Harteveldt, US aviation stakeholders expect the new administration to extend the Coronavirus Aid, Relief and Economic Security (CARES) Act for another six months. Launched in March by the Trump administration, the CARES Act was a $2.2tn stimulus package to help the American economy face the ongoing pandemic-induced economic crisis. Aviation, which was heavily impacted by travel restrictions, received $61bn in grants, loans and tax relief.
“There is a $908bn bill right now being discussed in Congress, and it’s unclear to me if part of that will be redirected to the airline industry,” Harteveldt explains. “There is a belief that while airline workers deserve support, so do workers in a lot of other industries that were hit very hard, [such as] hospitality, entertainment and the performing arts.
There is a belief that while airline workers deserve support, so do workers in a lot of other industries
“It’s unclear to me whether the Biden administration will offer financial support to industries or if it will encourage Congress to work on supporting unemployed Americans.”
Harteveldt believes that the industry will lobby Washington to have its employees designated as essential workers. The status would allow them to be in a higher priority category when coronavirus vaccines are available to the US population.
“If the airlines expected vaccines to become widely available in the US by June, I think that they would still push for enough money to fund them for six months,” he adds. “It may not be the same $25bn that they asked in the first [CARES Act] round, it may be less.”
Warming up relations: more open skies, fewer travel bans
Compared to the Trump administration’s controversial bans – such as Executive Order 13769, also known as ‘the Muslim Ban’ – analysts believe that Biden will aim for US aviation to take new centre stage in international affairs, implementing open skies agreements with countries such as China and Cuba.
This would be in stark opposition to Trump’s trade war with China. Started in 2018 when President Trump introduced sanctions on Chinese steel imports, the US-China trade war is expected to have slowed down global gross domestic product growth by 0.7% as a result of commercial hostilities.
Aviation was especially hit by the trade war, as reported by the International Air Transport Association (IATA). According to IATA, the hostilities between the US and China had a negative impact on air cargo, with freight contracting by 3.9% compared to the previous year.
“The Biden administration will look at how to manage relationships with China,” says Harteveldt. “Depending on whether the two countries are able to warm up their commercial relations, perhaps one outcome of that may be an open skies agreement.”
The Biden administration will look at how to manage relationships with China
Although never rosy, diplomatic relations between the US and Cuba worsened under the Trump presidency with the introduction of new restrictions, including on the import of rum and cigarettes. In December 2019, the US Transportation Department banned flights to cities other than Havana.
“We will see the new administration attempt to warm up relations between the US and Cuba, which had begun under the Obama administration, and thus may result in a resumption of tourism and business travel between the two countries, which was reduced under Trump,” Harteveldt adds.
Contrary to the previous administration, experts believe that Biden won’t impose blanket travel bans but will focus on ensuring Covid-safe flights to and from the US.
“The whole concept of aviation security is being redefined by Covid-19. After 9/11 and until earlier this year, security was essentially associated [with] avoiding terrorism threats, but today travellers seem more concerned about avoiding contagion,” explains Buckinghamshire New University aviation management senior lecturer Francesco Ragni.
“I expect Biden to have a good understanding of that and to encourage industry efforts to implement better protocols to bring people back on aeroplanes safely.”
Towards a greener future for aviation
Joe Biden’s presidential campaign focused heavily on the environment, including a pledge to make the US climate neutral by 2050.
To do so, the President-elect will need to support some of the country’s most polluting industries, including aviation, in their attempts to become greener.
In his manifesto, Biden pledged to focus on the development of low-carbon aviation technologies, as well as committed $400bn to clean energy innovation over ten years. “If we transform our modes of transportation and the sources of energy that power them, we can make real progress toward reducing our greenhouse gas emissions,” read his manifesto.
Investments will also involve reducing the cost of biofuels, as well as the development of more efficient engines to power long-haul flights and contribute to the goal of net-zero emissions.
Biden will certainly bring a new focus on reducing greenhouse emissions from aviation
Ragni believes that the move will have positive impacts on the industry. “Biden will certainly bring a new focus on reducing greenhouse emissions from aviation, and I think this is really a positive thing for the industry, which will not be caught unprepared,” he explains. “Airlines and airports have been analysing the issue for many years and have already set up ambitious goals and launched projects to be more eco-friendly.
“A greater push on reducing emission from the US will help the industry to focus and act on it, although it should be clear that net-zero aviation is not a realistic goal in the short-medium term.”
Compared to countries in Europe or Asia, Harteveldt says, the US rail network is not integrated with aviation hubs, with railways not reaching major gateway airports. If properly integrated, rail links will reduce the need for people to take short-haul flights, reducing CO2 emissions from aviation.
“While I’m not sure that the Biden administration will be able to get those rail links built, it might try to as a part of its policy,” he says. “I think the administration would like to [make] it possible for people to make a more seamless journey by rail or transit from where they live to an airport so that they wouldn’t need to get on a [short-haul] plane.”
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