Corona-hit global aviation industry stares at $84.3b loss in 2020

As the world reels under the impact of the Covid-19 pandemic, a report of the International Air Transport Association (IATA) has estimated a loss of $84.3 billion in 2020 for the aviation industry worldwide. 

Alexandre de Juniac, IATA’s Director General, said: “2020 will go down as the worst year in the history of aviation. On average, every day of this year will add $230 million to industry losses. In total, that’s a loss of $84.3 billion. That’s why government financial relief was and remains crucial as airlines burn through cash,”

The IATA’s Director General said revenues will fall 50% to $419 billion in 2020 from $838 billion in 2019. He also added that a key to the recovery is universal implementation of the re-start measures agreed through the International Civil Aviation Organisation (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. Several countries across the globe put severe restrictions on movement in a bid to curb the spread of the coronavirus.

Juniac warned that airlines will still be financially fragile in 2021, and said: “Passenger revenues will be more than one-third smaller than in 2019. And airlines are expected to lose about $5 for every passenger carried. The cut in losses will come from re-opened borders leading to increased volumes of travellers. Also, losses are expected to be cut to $15.8 billion as revenues rise to $598 billion.” IATA has around 300 airlines as its members that handle around 82% of the total global air traffic.

 IATA had in May said that Indian airlines will lose $11 billion in revenue this year and 47% of its air traffic, while the domestic aviation industry could record 3 million job losses. India is the fifth largest aviation market in the world. About 4,500 domestic and international flights are operated from India every day, of which around 600 are international flights. More than 1,000 flights operate almost daily from Delhi. However, before the lockdown in India, there was a 30% decline in the services of domestic airlines.

Earlier, after a gap of two months, India resumed its scheduled domestic passenger flights on 25 May. Scheduled international passenger flights continue to remain suspended in India.

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