The International Air Transport Association (IATA) is predicting that airlines are set to lose a staggering $84 billion this year, due to the Coronavirus pandemic, which has cut the sector’s revenue by half.
With most of the world’s airlines being parked currently, IATA forecasts revenue to fall from $838 billion last year to $419 billion in 2020 – marking the worst year for the airline industry.
“Every day of this year will add $230 million to industry losses,” IATA Director, General Alexandre de Juniac said. This would be an average loss of almost $38 per passenger flown.
IATA expects losses of about $15.8 billion in 2021 – taking the two-year total to about $100 billion, as airline traffic is struggling to recover and airlines continue to cut fare prices to win over customers.
“Airlines will still be financially fragile in 2021,” De Juniac said, while predicting “even more intense” competition. “That will translate into strong incentives for travellers to take to the skies again,” he added.
For 2021, IATA is forecasting the industry to rise to $598 billion in revenue. Passenger numbers are seen to fall to 2.25 billion this year, before rising to 3.38 billion in 2021, which is still more than 25% below 2019 numbers.