Royal Air Maroc Struggles Amid Global Aviation Crisis, Expert Warns

In her presentation of RAM’s situation published on the atlasinfo website, the lawyer recalls "that the air transport sector is facing the worst crisis in its history. Like RAM, the cash flow of airlines is in the red due to the total lack of revenue while fixed costs are extremely high.

Referring to the latest media appearance of the Director General of the International Air Transport Association (IATA), Malika Lahnait points out that the shortfall generated by covid-19 is estimated at $252 billion. During his intervention, he urged governments to act quickly, through substantial financial support, to prevent "us from running out of liquidity and nearly half of the companies from dying because of the coronavirus".

As for RAM, she argues that the national airline is negotiating with its partners to reduce its fixed costs and preserve its cash flow. According to her, the challenge is to hold out until the next booking period for the summer season 2021. This period (late March-late October) is indicated to start having significant cash inflows again. The summer of 2020 seems somewhat compromised due to the closure of European airspace until September 2020 apparently, she specifies.

According to the legal counsel, Royal Air Maroc will however be able to count on the rapid recovery of traffic via Moroccans living abroad, as soon as all constraints are lifted (closure of airspace in Morocco and in the source countries).

As an example, she cites the edifying case of Air France, which benefited from the support of the French state to increase its guarantee for loans up to 7 billion euros in order to mitigate the economic effects of the epidemic. This aid will provide the company with the liquidity it needs to withstand the repercussions of the pandemic, she argues. Counting on the patriotism of the leaders, she expresses the hope that the government will support the national company so that it can continue its activity and its missions. She also adds that RAM is indeed a strategic company that is part of the national heritage and contributes to its international influence.