Based on its revised airline industry outlook for the remainder of this year and 2021, the International Air Transport Association (IATA) anticipates losses to continue into next year.
Per the IATA, a net loss of $118.5 billion is expected for 2020, while a net loss of $38.7 billion is anticipated in 2021. Officials indicated next year’s performance factors will show improvements in 2020. The second half of 2021 is expected to see improvements after a challenging first half.
“This crisis is devastating and unrelenting,” IATA Director General and CEO Alexandre de Juniac said. “Airlines have cut costs by 45.8 percent, but revenues are down 60.9 percent. The result is that airlines will lose $66 for every passenger carried this year for a total net loss of $118.5 billion. This loss will be reduced sharply by $80 billion in 2021. But the prospect of losing $38.7 billion next year is nothing to celebrate. We need to get borders safely re-opened without quarantine so that people will fly again. And with airlines expected to bleed cash at least until the fourth quarter of 2021, there is no time to lose.”
de Juniac acknowledged that while government support has kept airlines alive, more assistance is likely needed to consider the situation lasting longer than anyone anticipated.
“And it must come in forms that do not increase the already high debt load which has ballooned to $651 billion,” he said. “Bridging airlines to the recovery is one of the most important investments that governments can make. It will save jobs and kick-start the recovery in the travel and tourism sector, which accounts for 10 percent of global GDP.”