“The fact is, people can only binge on Netflix for so long,” Hayes said an interview on “Squawk on the Street.”
“Zoom is fun but you can’t experience the Eiffel Tower from a Zoom meeting. You can’t take your kids to Disneyland on Zoom, so, people will get back. They will start flying again, they will recover,” he added.
Hayes told Cramer that he believed the commercial aerospace market in the United States had bottomed in April.
“I think it can’t get much worse than down 95%,” Hayes said.
The four biggest U.S. passenger airlines in April posted their first quarterly losses in years as U.S. travel demand dropped more than 90%, a result of the virus and measures to keep it at bay, like shelter-in-place orders. United‘s stock is down by about 25% since the end of March, Delta is off 23%, Southwest has fallen 28% and American is down about 21%.
“Just to give you an example, we typically get 80 to 100 engines in a month, takes about 90 days to overhaul those and we generate revenue as we overhaul the engines. For the month of April that was 24 engines instead of the normal 80 to 100, so yeah, it’s going to be tough,” he added.
Hayes shared that in his discussions with airlines and other industry partners, assuming there was not a resurgence in Covid-19 cases, the recovery process for the commercial aerospace sector would begin in the summer.
“So this is going to be a tough quarter on commercial aero but the good news is that we are starting to see some light at the end of the tunnel. So we will see recovery but clearly, Q2 is going to be really tough,” he said.