In an addressal at the inaugural session of the International Air Transport Association’s (IATA) 77th Annual General Meeting, Willie Walsh, Director General, IATA, said that the global airline industry might be prepared to report a loss above $200 billion during 2020-22.
Detailing in numbers, IATA stated that the collective deficit is going to fall to $11.6 billion next year in 2022 from $51.8 billion this year. “Net 2020 loss estimates have been revised to $137.7 billion (from $126.4 billion). Adding these up, total industry losses in 2020-2022 are expected to reach $201 billion,” it added.
Mr. Walsh said, “To survive airlines have dramatically cut costs and adapted their business to whatever opportunities were available. We are well past the deepest point of the crisis. While serious issues remain, the path to recovery is coming into view. Aviation is demonstrating its resilience yet again.”
“People have not lost their desire to travel as we see in solid domestic market resilience. But they are being held back from international travel by restrictions, uncertainty and complexity. More governments are seeing vaccinations as a way out of this crisis.”
The Association estimated that the industry might witness 2.3 billion passengers in 2021 and 3.4 billion in 2022. These numbers are significantly below 4.5 billion travellers in 2019, and very much similar to domestic travel in 2014 by the end of 2022. The IATA DG said that the air cargo business is also seeing a healthy graph and is expected to continue with 2021 demand at 7.9 percent above 2019 levels, growing to 13.2 percent above 2019 levels in 2022.
“In 2021 overall demand is expected to reach 40 percent of the pre-crisis (2019) levels. Capacity is expected to increase faster than demand, reaching 50 percent of the pre-crisis levels for 2021. The average passenger load factor in 2021 is expected to be just 67.1 percent, a level not seen since 1994,” he pointed out.
Walsh added that in 2021, domestic demand is expected to reach 73 percent of the pre-crisis (2019) levels, while in 2022 domestic demand is expected to reach 93 percent of the pre-crisis (2019) levels.
However, international demand is driving on a different track and will recover at a minimal pace owing to continuing restrictions on the freedom of movement across borders, quarantine measures, and traveller uncertainty.
“Aviation is resilient and resourceful, but the scale of this crisis needs solutions that only governments can provide. Financial support was a lifeline for many airlines during the crisis,” Mr. Walsh added.
The airline trade association’s AGM also approved a resolution for the global air transport industry to achieve net-zero carbon emissions by 2050.