IATA anticipates deeper revenue hit to global aviation amid COVID-19 pandemic

Delta's March passenger revenues are expected to plunge by US$2 billion. Photo by Andrew Pries | AeroNewsX.

On the 24th of March 2020, the International Air Transport Association (IATA) reported a deeper than earlier anticipated financial hit to the global air transport industry. The financial hit in terms of declining passenger revenues is expected to plummet by a staggering US$252 billion (44% below the year 2019), stemming from increased travel restrictions in the wake of the COVID-19 pandemic, and slower industry recovery in an expected global economic recession after the containment of the pandemic.

This is in contrast to the earlier estimate quoted on the 5th of March 2020, in which the trade body had placed the figure at up to US$113 billion. An earlier analysis released in February, which had only taken into account air transport markets associated with China, had placed the figure at US$29.3 billion.

According to IATA Director General Alexandre de Juniac, “The airline industry faces its gravest crisis. Within a matter of a few weeks, our previous worst case scenario is looking better than our latest estimates. But without immediate government relief measures, there will not be an industry left standing."

This updated analysis comes amid increasing calls by various industry leaders and trade organisations for increased government support to the aviation industry; meant to cushion the industry from widespread financial shock due to significantly reduced operations, and to ensure a quicker industry-wide recovery after the containment of the pandemic and resumption of normal air transport services.

The Trump administration has already signalled the approval of a US$50 billion economic stimulus package to American airlines as part of a larger economic plan to soften the blow of the pandemic to the American economy. Elsewhere, civil aviation regulators in the United Arab Emirates, China, the United Kingdom, and Mexico have announced a variety of extensions to the validity of permits, licences, and certificates for technical personnel in the air transport industry in a bid to provide flexibility to strained flight crew and airline operations brought about by the COVID-19 crisis.