Geneva : The International Air Transport Association (IATA) expects net airline industry losses of 47.7 billion dollars in 2021 with a net profit margin of minus 10.4 per cent.
This is an improvement on the estimated net industry loss of 126.4 billion in 2020 with a net profit margin of minus 33.9 per cent.
Travel restrictions, including quarantines, have killed demand. IATA estimates that travel (measured in revenue passenger kilometres) will recover to 43 per cent of 2019 levels over the year. While that is a 26 per cent improvement on 2020, it is far from a recovery.
Domestic markets will improve faster than international travel. Overall passenger numbers are expected to reach 2.4 billion in 2021. That is an improvement on the nearly 1.8 billion who travelled in 2020 but well below the 2019 peak of 4.5 billion.
“This crisis is longer and deeper than anyone could have expected. Losses will be reduced from 2020, but the pain of the crisis increases,” said Willie Walsh, IATA’s Director General.
There is optimism in domestic markets where aviation’s hallmark resilience is demonstrated by rebounds in markets without internal travel restrictions, he said. Government imposed travel restrictions, however, continue to dampen the strong underlying demand for international travel.
“Despite an estimated 2.4 billion people travelling by air in 2021, airlines will burn through a further 81 billion dollars ofcash,” said Walsh.
At the same time, industry revenues are expected to total 458 billion dollars. That is just 55 per cent of the 838 billion dollars generated in 2019 but represents 23 per cent growth on the 372 billion dollars generated in 2020.
Passenger revenues are expected to total 231 billion dollars, up from 189 billion dollars in 2020, but far below the 607 billion dollars generated in 2019.
Cargo revenues are expected to reach 152 billion dollars, an historic high. This is up from 128 billion dollars in 2020 and 101 billion dollars in 2019.
Asia Pacific carriers see 45 per cent of their revenue passenger kilometres generated on domestic markets as well as the relative importance of air cargo to the region.
Net losses are expected to be reduced from minus 31.1 per cent of revenues in 2020 to minus 8.8 per cent of revenues this year, said IATA.