Air traffic to remain below pre-Covid-19 levels until 2024

Published: 30 July 2020 - 3 a.m.

Airlines around the world are in the coronavirus crisis for the long-haul with global passenger traffic not expected return to pre-Covid-19 levels until 2024, a year later than previously projected.

That is according to the International Air Transport Association (IATA), which has forecast that while short-haul travel is still expected to recover faster than long-haul travel, global passenger numbers for 2020 will decline by 55% compared to 2019, worsened from the April forecast of 46%.

“Passenger traffic hit bottom in April, but the strength of the upturn has been very weak,” said Alexandre de Juniac, IATA’s CEO.

“What improvement we have seen has been domestic flying. International markets remain largely closed. And in many parts of the world infections are still rising. All of this points to a longer recovery period and more pain for the industry and the global economy.”

June 2020 passenger traffic foreshadowed the slower-than-expected recovery. Traffic fell 86.5% compared to the same period last year. That is only slightly improved from a 91.0% contraction in May. This was driven by rising demand in domestic markets, particularly China. The June load factor set an all-time low for the month at 57.6%.

IATA is partly blaming slow virus containment in the US and developing economies for the delay in recovery. It said there is little sign of virus containment in many important emerging economies, which in combination with the US, represent around 40% of global air travel markets. Their continued closure, particularly to international travel, is “a significant drag on recovery”, a statement read.

Reduced business travel due to shrinking corporate travel budgets is also expected to dampen recovery. And while pent-up demand exists for visiting friends and relatives and leisure travel, consumer confidence is weak in the face of concerns over job security and rising unemployment, as well as risks of catching Covid-19, IATA said. Some 55% of respondents to IATA’s June passenger survey don’t plan to travel in 2020.

De Juniac said that governments need to continue offering relief measures to airlines, including direct financial support, throughout the winter season.

He said: “A full Northern Winter season waiver on the 80-20 use-it-or-lose it slot rule, for example, would provide critical relief to airlines in planning schedules amid unpredictable demand patterns.

“Airlines are planning their schedules. They need to keep sharply focused on meeting demand and not meeting slot rules that were never meant to accommodate the sharp fluctuations of a crisis. The earlier we know the slot rules the better, but we are still waiting for governments in key markets to confirm a waiver.”

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