IATA increases airline losses to the coronavirus crisis to 286,500 million

Predicts a 48% drop in passenger traffic this year compared to last

The International Air Transport Association (IATA) has raised the loss forecasts for the passenger air transport sector on Tuesday, and now calculates that they will reach 314,000 million dollars (286,500 million euros) in 2020 due to the impact of the crisis of the coronavirus.

This reduction will mean a fall in the income of the companies in the sector of 55% compared to 2019 due to the travel restrictions decreed by governments around the world to stop the spread of the pandemic.

IATA’s perspectives on the impact of the coronavirus, which estimated losses of 252,000 million dollars (229,948 million euros) on March 24, have been aggravated by the «significant deepening» of the crisis since these forecasts were published .

In addition, the Association foresees a drop in passenger traffic of 48% this year compared to the past, which will have an impact on the financial results of airlines.

«The industry picture grows increasingly dimmer. The magnitude of the crisis makes a strong V-shaped recovery unlikely. Realistically, it will be a U-shaped recovery with domestic travel recovering faster than the market. international «, said Alexandre de Juniac, CEO of IATA.

In addition, it has warned that airlines could spend up to $ 61 billion of cash reserves in the second quarter alone, putting 25 million aviation-dependent jobs at risk.

STATE SUPPORT

Given the impact of the crisis on the aviation sector and its consequences on tourism worldwide, IATA has asked governments to include aviation in the stabilization packages against the pandemic.

«Financial relief for airlines today should be a critical policy measure for governments. Supporting airlines will keep vital supply chains running during the crisis. Every airline job saved will keep 24 more people employed,» Juniac has explained.

In this regard, it has asked governments for direct financial support to passenger and cargo carriers to compensate for the reduction in revenue and liquidity attributable to the imposed travel restrictions.

In addition, it has urged the provision of loans, loan guarantees and support to the corporate bond market by governments or central banks, and to lower payroll taxes on wages paid to date and / or an extension of payment terms. for the rest of 2020, along with a temporary exemption from ticket taxes and other levies.