Identification of the Degree of Economic Resilience of Ukrainian Air Carriers

Abstract

The aim of the study is to justify the appropriateness of using the Harrington’s desirability function as a tool for integral assessment of enterprise economic resilience using the example of domestic air carriers. The article investigates activities of nine air companies in the Ukrainian market: CJSC AC International Airline of Ukraine, JSC Motor Sich, Windrose Aviation Company, YanAir, LLC Meridian Air Company, LLC SkyUp Airlines, LLC Azur Air Ukraine Airlines, Bukovyna Airlines, Bravo Airways. Based on the results of assessing the degree of economic resilience, it is concluded that enterprises engaged in providing freight transportation services, air companies whose main activity is passenger air transportation stayed in the safe profit zone throughout the study period. All other participants in the aviation market suffered losses, respectively, were in the risk zone, given a critical lack of financial resources not only for the expanded provision of services but also for covering the current needs of operating activities, which naturally leads to an increase in short-term indebtedness, and, as a result, to a growth in an air company’s financial expenses for repaying them. Using the Harrington’s scale to identify the degree of economic resilience of the air carriers revealed that the main resource risk for most air companies is a critical lack of highly liquid assets and short-term financial investments, an insufficient net cash flow. Most Ukrainian air carriers operate at risk and critical risk.

Keywords

• economic resilience
• harrington’s desirability function
• risk
• assessment