Imagine a passenger plane at 30,000 feet suddenly facing dual crises of engine failure and fuel exhaustion. For airlines, the financial impact of COVID-19 presented an equally dire emergency. During the CFO panel at IATA's World Air Transport Summit, financial leaders from VietJet and JetBlue Airways unanimously emphasized the critical importance of cash preservation during financial crises. But how did carriers ensure sufficient "fuel" to navigate this unprecedented storm and prepare for post-crisis recovery?
Cash Flow: The Critical Lifeline
JetBlue Airways CFO Ursula Hurley recalled the peak pandemic period in 2020 when revenue plummeted 90%, with daily cash burn reaching $18 million. "My job became securing as much cash as possible," Hurley stated. The airline successfully raised $1 billion within five days, buying crucial survival time. This dramatic rescue operation underscored cash reserves as the ultimate determinant of airline viability during crises.
VietJet's Ho Ngoc Yen Phoung shared similar priorities, detailing how proactive negotiations with suppliers, financial institutions, and distributors helped minimize cash outflows. These meticulous cash management strategies became operational lifelines when traditional revenue streams evaporated.
Dual Strategies: Preserving and Generating Cash
Airlines implemented aggressive cost-cutting measures alongside their cash preservation efforts. Hurley revealed JetBlue deferred $2 billion in capital expenditures to future years, providing immediate financial relief. Simultaneously, carriers innovated new revenue streams—converting passenger aircraft for cargo operations and aggressively marketing ancillary services like seat upgrades and baggage fees to offset lost passenger revenue.
Balance Sheet Recovery: The Post-Crisis Priority
As travel demand rebounds, balance sheet reconstruction has emerged as a strategic focus. JetBlue, which entered the pandemic with one of the industry's strongest balance sheets (30-40% debt-to-capital ratio), saw this metric spike to 65% during the crisis. Through disciplined financial management, the airline has reduced this to approximately 54%, signaling meaningful progress toward financial recovery.
Fuel Hedging: A Calculated Gamble
The panel highlighted divergent fuel hedging approaches—VietJet currently hedges 30-50% of fuel consumption, while JetBlue maintains zero coverage. "I wish we had hedged," Hurley admitted, noting JetBlue typically hedges 10-25% under normal circumstances. This risk management tool remains controversial—potentially mitigating price spikes but risking significant losses if market predictions prove incorrect.
Industry Resilience and Transformation
The pandemic forced unprecedented operational adaptations while accelerating digital transformation across the sector. Airlines demonstrated remarkable resilience through cash flow discipline, cost optimization, and strategic balance sheet management—providing valuable crisis management lessons for other industries facing sudden disruptions.
Building Future Resilience
Looking ahead, airlines face evolving challenges including climate change, geopolitical risks, and technological disruption. Industry collaboration on sustainable aviation fuels (SAF), exploration of alternative propulsion technologies (electric/hydrogen aircraft), and continued service innovation will shape aviation's next chapter. By learning from pandemic-era financial strategies while embracing these emerging priorities, carriers can build more resilient business models for an uncertain future.