International airlines are heading towards dramatic losses of up to $113 billion this year, IATA warned on Thursday as carriers stepped up flight cancellations around the world in response to a slump in new bookings and a flood of cancellations.
Losses from passenger operations could end up between $63 billion (best-case) and $113 billion (worst-case) depending on how the coronavirus crisis continues to impact travel demand. If the Covid-19 virus spread is limited, then passenger numbers are likely to drop between 10% (Germany, France) and 23-24% (Italy, China) in major markets. But if the virus continues spreading extensively, airline passenger numbers could crash by 24% in big European markets and by 23% in top Asian markets, IATA estimated.
“Many airlines are cutting capacity and taking emergency measures to reduce costs. Governments must take note. Airlines are doing their best to stay afloat as they perform the vital task of linking the world’s economies. As governments look to stimulus measures, the airline industry will need consideration for relief on taxes, charges and slot allocation. These are extraordinary times,” said Alexandre de Juniac, IATA’s Director General and CEO.