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    Tragedies in the Sky: How airlines handle the reputational and financial fallout of disasters

    On December 25, 2024, a tragic incident occurred involving an Azerbaijan Airlines flight. Initially scheduled to travel from Baku to Grozny, the aircraft had to alter its course due to heavy fog along the planned route and it diverted toward Kazakhstan but tragically crashed near Aktau. There were 67 people onboard, of whom, according to Kazakh authorities, 38 lost their lives. This tragedy has once again raised concerns about aviation safety, highlighting that even experienced airlines are not always insured against disasters.

    Various airlines operate in Kyrgyzstan, including major international carriers such as Flynas (Saudi Arabia), Fly Dubai (UAE), Aeroflot (Russia) and Air Astana (Kazakhstan), as well as local airlines like Aero Nomad Airlines, Asman Airlines and others. All these carriers operate international routes and, unfortunately, face similar risks, as evidenced by aviation incidents worldwide.

    According to data from the Aviation Safety Network, there have been 2,664 aviation accidents worldwide over the past decade. The highest number was recorded in 2019, with 295 incidents, while the lowest was in 2024, with 186 incidents.

    This list includes airlines that operate in Kyrgyzstan. The most common causes of accidents are engine failure, bird strikes and emergency landings related to technical issues with the aircraft. For example, Fly Dubai (UAE) experienced a tragic crash of its flight in Rostov-on-Don in 2016, resulting in the deaths of 62 people, all on board. Aeroflot (Russia) faced a crash of its flight at Sheremetyevo in 2019, where 41 of the 78 passengers onboard lost their lives. S7 Airlines (Russia) and other companies, such as UTair (Russia) and Red Wings (Russia), have also encountered various incidents related to equipment failure and emergency landings. In May of this year, the domestic airline Avia Traffic (Kyrgyzstan), which had taken off from Manas Airport, made an emergency landing shortly after takeoff due to a bird striking one of its engines. The passengers were evacuated to a sterile area, and fortunately, no one was injured.

    An airplane crash is primarily a tragedy that claims lives. For the loved ones of the deceased, the loss cannot be compensated in any way; however, this does not relieve the airline of its responsibility. Under the Montreal Convention, to which more than 100 countries are parties, in the event of passenger fatalities onboard, the airline is obligated to pay compensation of up to 100,000 SDR (approximately $136,000). As a participant in this convention, Azerbaijan is required to make such payments.

    However, financial compensation is just one aspect of the issue.

    An airline faces numerous legal disputes and court expenses, which significantly complicate the recovery process after a tragedy. Moreover, a crash becomes a true test for the carrier, involving it in investigations and financial repercussions that can stretch on for years.

    Additionally, let's not forget the loss of the aircraft itself, which can be worth tens or even hundreds of millions of dollars. For example, the Embraer E190 of Azerbaijan Airlines that crashed, which was 11 years old, could have been valued at between $15 million and $45 million. The price depends on several factors, including the aircraft's condition, flight hours, technical specifications and the resale market.

    In addition, the airline faces significant legal expenses, including defense against lawsuits, which can result in prolonged legal proceedings lasting many years. Moreover, the suspension of flights on the Baku–Grozny–Baku and Baku–Makhachkala–Baku routes, undertaken by Azerbaijan Airlines following the crash, will undoubtedly impact its revenue and may also incur additional costs due to obligations toward passengers.

    The most devastating consequence for an airline, however, is the loss of passenger trust. This leads to decreased demand for flights, which can severely impact the company’s financial performance. In such cases, the airline faces a long road to restoring its reputation.


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