Industry IATA expects deeper revenue hit from COVID-19 than anticipated
The International Air Transport Association (IATA) has released a new forecast on the revenue losses during COVID-19.
that the global industry passenger revenues could plummet US$ 252 billion or 44% below the figures from last year.
IATA’s Director General and CEO, Alexandre de Juniac commented: “The airline industry faces its gravest crisis. Within a matter of a few weeks, our previous worst-case scenario is looking better than our latest estimates. But without immediate government relief measures, there will not be an industry left standing. Airlines need $200 billion in liquidity support simply to make it through. Some governments have already stepped forward, but many more need to follow suit.”
Previously, IATA expected, that the Coronavirus-crisis would hit the aviation industry with a US$ 115 billion loss. The gravity of the pandemic however has now led the authority to correct this figure. Currently, large parts of the world are on lockdown.
This means, that many airlines are temporarily ceasing operations or are flying with a very small flight schedule and fleet. Lufthansa for example has around 80% of its fleet grounded, same with other leading carriers around the world.
On the one hand, airlines are stopping flights because the travel demand has decreased dramatically, but on the positive effect the cancellation of flights could help to diminish the spread of COVID-19. In aircraft, many people from different countries and countries of origin are coming together, meaning that the danger of infecting others is very high.
The IATA added: “The latest analysis envisions that under this scenario, severe restrictions on travel are lifted after 3 months. The recovery in travel demand later this year is weakened by the impact of global recession on jobs and confidence. Full year passenger demand (revenue passenger kilometres or RPKs) declines 38% compared to 2019. Industry capacity (available seat kilometre or ASKs) in domestic and international markets declines 65% during the second quarter ended 30 June compared to a year-ago period, but in this scenario recovers to a 10% decline in the fourth quarter.”
Source © iata.org