One-third of Czech aerospace companies see COVID-19 pandemic as an opportunity, says new survey

About 20% of companies in the Czech sector had to stop operations during the pandemic, while 26% faced wage cuts and layoffs

Jason Pirodsky

Written by Jason Pirodsky
Published on 03.08.2020 08:43 (updated on 03.08.2020)

czechinvest

Of all the sectors affected by the coronavirus pandemic, the aerospace industry has been one of the worst hit, with manufacturers across the globe experiencing a dramatic downturn in demand to to restrictions on travel and other effects of the crisis.

According to a new survey of the local aerospace industry conducted recently by CzechInvest, 80% of Czech companies in the sector experienced decreased demand due to the coronavirus crisis. More than half of companies (63%) had restrictions on production and development, while 28% cut their production down by half.

CzechInvest polled 46 respondents from small, medium, and large-sized businesses in the Czech aerospace industry to discover the impacts of the coronavirus crisis on leading local companies in the sector. The majority of these companies specialize in manufacturing aircraft and aircraft components, and operate in the fields of engineering and the space industry.

Almost a fifth (19.6%) of companies surveyed had to completely stop operations due to the anti-coronavirus measures adopted by the Czech Republic during March and April. More than a quarter (26%) of companies in the sector were impacted by wage cuts and layoffs. Some of the companies surveyed cut up to half of their workforce.

“The survey showed that the coronavirus crisis affected practically all of the companies surveyed,” stated CzechInvest’s Michal Janečka, an aerospace specialist and the author of the survey.

“Most of them expect to return to normalcy, half of them by roughly the end of the year. However, a less positive figure is the quarter of companies that are fighting for survival. If we look at the size of the aerospace industry in the Czech Republic, that is not a negligible number.”

But it isn’t all bad news: more than a third (34.8%) of the companies surveyed said they saw new opportunities created by the pandemic.

During the pandemic, 80% of the companies surveyed said they made use of home office and online tools to adapt. Only three companies (6.5%) stated that they did not use online meetings during the crisis. The change in work habits led to new challenges and needs that will continue through the immediate future and beyond.

Ten percent of the companies surveyed directly adapted to the crisis by switching their development to products of immediate need, including protective medical equipment.

The Czech Republic is one of the few countries in the world that can completely develop and assemble an aircraft on its own, without the need for parts or services from other countries. This puts the country’s aerospace industry in a unique position, and the country is currently developing a support program to ensure that companies within the sector have what they need to adjust to a changing landscape.

Sometime this autumn, a support package for businesses within the aerospace industry to help them recover from the coronavirus crisis will be made available from the Czech Ministry of Industry and Trade.

More information about the recent survey conducted by CzechInvest on the impacts of the coronavirus crisis on the Czech aerospace industry (in Czech) can be found here.