RIYADH: Total airline industry losses from 2020 to 2022 are expected to reach $201 billion despite a post-pandemic improvement, according to the International Air Transport Association .
Net losses are expected to come in at $11.6 billion in 2022 after a $51.8 billion loss in 2021, IATA said in its latest outlook for airline industry financial performance, showing improved results amid the continuing COVID-19 crisis.
Demand is expected to stand at 40 percent of 2019 levels for 2021, rising to 61 percent in 2022.
A $2.3 billion charges increase during this crisis is outrageous. We all want to put COVID-19 behind us. But placing the financial burden of a crisis of apocalyptic proportions on the backs of your customers, just because you can, is a commercial strategy that only a monopoly could dream up. At an absolute minimum, cost reduction—not charges increases—must be top of the agenda for every airport and ANSP. It is for their customer airlines
Willie Walsh, IATA’s director general
Total passenger numbers are expected to reach 2.3 billion in 2021, and will grow to 3.4 billion in 2022 — significantly below the 4.5 billion travelers of 2019.
Robust demand for air cargo is expected to continue, with 2021 demand at 7.9 percent above 2019 levels, growing to 13.2 percent above 2019 levels for 2022.
The air cargo business is performing well, and domestic travel will be near pre-crisis levels in 2022, IATA said.
Meanwhile, the association warned the planned increases in charges by airports and air navigation service providers will stall recovery in air travel and damage international connectivity.
Confirmed airport and ANSP charges increases have already reached $2.3 billion. Further increases could be tenfold this number if proposals already tabled by airports and ANSPs are granted.
“A $2.3 billion charges increase during this crisis is outrageous. We all want to put COVID-19 behind us. But placing the financial burden of a crisis of apocalyptic proportions on the backs of your customers, just because you can, is a commercial strategy that only a monopoly could dream up. At an absolute minimum, cost reduction—not charges increases—must be top of the agenda for every airport and ANSP. It is for their customer airlines,” said Willie Walsh, IATA’s director general.
“Infrastructure shareholders, governmental or private, have benefited from stable returns pre-crisis. They must now play their part in the recovery. It is unacceptable behavior to benefit from your customers during good times and stick it to them in bad times,” he said.
IATA’s 77th annual general meeting approved a resolution for the global air transport industry to achieve net-zero carbon emissions by 2050. This commitment will align with the Paris Agreement goal for global warming not to exceed 1.5 C.
“The world’s airlines have taken a momentous decision to ensure that flying is sustainable. The post-COVID-19 reconnect will be on a clear path toward net zero,” Walsh said.
“With the collective efforts of the entire value chain and supportive government policies, aviation will achieve net zero emissions by 2050,” he added.
“We have a plan. The scale of the industry in 2050 will require the mitigation of 1.8 gigatons of carbon. A potential scenario is that 65 percent of this will be abated through sustainable aviation fuels. We would expect new propulsion technology, such as hydrogen, to take care of another 13 percent. And efficiency improvements will account for a further 3 percent. The remainder could be dealt with through carbon capture and storage (11 percent) and offsets (8 percent).”