Updated revenue analysis from IATA shows worsening impacts of COVID-19
IATA now estimates that industry passenger revenues could plummet by $252 billion; 44 per cent below 2019’s figure.
The International Air Transport Association (IATA) has updated its analysis of the revenue impact of the COVID-19 pandemic on the global air transport industry.
Owing to the severity of travel restrictions and the expected global recession, IATA now predicts that industry passenger revenues will drop by $252 billion – 44 per cent below 2019’s figure.
This was determined considering severe travel restrictions last for up to three months, followed by a gradual economic recovery later in 2020.
IATA’s previous analysis of up to a $113 billion revenue loss was made on 5 March, before the countries around the world introduced sweeping travel restrictions that largely eliminated the international air travel market.
“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,” said IATA’s Director General and CEO, Alexandre de Juniac.
The recovery in travel demand later in 2020 is weakened by the impact of global recession on jobs and confidence. Full year passenger demand (revenue passenger kilometres or RPKs) is predicted to decline by 38 per cent compared to 2019. Industry capacity (available seat kilometre or ASKs) in domestic and international markets is estimated to decline by 65 per cent during the second quarter (ending 30 June compared to a year-ago period) but in this scenario recovers to a 10 per cent decline in the fourth quarter.