HYDERABAD: Airline losses are increasing to unprecedented levels due to the coronavirus pandemic. According to the International Air Transport Association (IATA) forecast on Tuesday, airlines are set to lose $84 billion in 2020 and the revenues will fall 50% to $419 billion from $838 billion in 2019.
IATA Director General Alexandre de Juniac said that, "Every day of this year will add $230 million to industry losses. Airlines will still be financially fragile in 2021. That will translate into strong incentives for travellers to take to the skies again."
Junaic said that 2020 will be noted as the worst year in the history of aviation, "On average, every day of this year will add $230 million to million to industry losses. In total that’s a loss of $84.3 billion."
The losses will be between 15% to 30% of revenue depending on the region and no profits can be expected until 2022 at the earliest. Junaic further added that, "A key to the recovery is universal implementation of the re-start measures agreed through the International Civil Aviation Organization (ICAO) to keep passengers and crew safe. And, with the help of effective contact tracing, these measures should give governments the confidence to open borders without quarantine measures and it is an important part of the economic recovery because about 10% of the world's GDP is from tourism and much of that depends on airtravel."
IATA report said that the traffic is slowing improving but for 2020 it is expected to fall by 54.7% compared to 2029. The passenger numbers are seen falling to 2.25 billion this year. The passenger revenues are expected to fall to $241 billion. This is greater than the fall in demand, reflecting an expected 18% fall in passenger yields as airlines try to encourage people to fly again through price stimulation.