Airline traffic to fall by two-thirds this year - IATA

Marco Green
September 30, 2020

The International Air Transport Association (IATA) has today issued a gloomy estimation of the drop in air traffic in 2020 over last year's numbers. IATA had previously forecast a 63% fall.

"International demand recovery is virtually non-existent and domestic markets in Australia and Japan actually regressed in the face of new outbreaks and travel restrictions", Mr de Juniac said. "This year the industry is heading into the slow season in the worst financial position in its history".

The Asia Pacific region is the worse hit with August traffic sinking 95.9 per cent compared to the year-ago period. Without the reopening of global borders and government relief measures, hundreds of thousands of airline jobs will be lost. If borders don't reopen the livelihoods of these people will be at grave risk.

The industry association said that August passenger demand continued to be hugely depressed against normal levels, with revenue passenger kilometres (RPKs) down 75.3 per cent compared to August 2019.

IATA said that domestic markets continued to outperform worldwide markets in terms of recovery, although most remained substantially down on a year ago with load factors at 58.5 per cent compared to the typical 80 per cent and higher.

August capacity (available seat kilometers or ASKs) was down 63.8% compared to a year ago, and load factor was 58.5%, which IATA calls an all-time low for the month of August.

"Both domestic and global load factors are well below what would be necessary to break even, so the industry is restarting but it looks as though it's still burning through cash, still making losses in its operations at the moment", Brian Pearce, Iata chief economist, said. European carriers' August demand plunged 79.9% compared to previous year, improved from an 87.0% drop in July, as travel restrictions were lifted in the Schengen Area. Capacity fell 82.6%, and load factor dropped 49.9 percentage points to 38.5%.

Forward bookings for air travel in the fourth quarter show that the recovery since the April low point will continue to falter, says IATA.

"Until we see stronger consumer confidence, we fear that a revival in leisure passenger travel will be relatively weak", Mr Pearce said.

As a result of the stalled improvement during the summer months, Iata is "less optimistic" about the remainder of the year and has downgraded its forecast for full-year passenger traffic.

"We do think these coming winter months are going to be pretty challenging for the airline industry", Mr Pearce concluded.

Other reports by Click Lancashire

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