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IATA: Airlines will stay cash-negative until 2022
Airlines will remain cash negative throughout 2021 at least, according to new analysis by the International Air Transport Association (IATA).
It had previously projected the final quarter of this year for airlines to start making money.
It puts the more pessimistic forecast down to the weak start in 2021.
It says forward bookings for summer 2021 are nearly 80% down compared to February 2019.
IATA expects global airlines to burn through $75-95 billion this year although gradual improvements will be seen from the second half of the year.
IATA’s worst case scenario sees air travel demand in 2021 at just 33% of 2019.
"With governments having tightening border restrictions, 2021 is shaping up to be a much tougher year than previously expected. Our best-case scenario sees airlines burning through US$75 billion in cash this year but it could be as bad as US$95 billion. More emergency relief from governments will be needed," said Alexandre de Juniac, IATA’s outgoing Director General and CEO.
"If governments are unable to open their borders, we will need them to open their wallets with financial relief to keep airlines viable."
Interest in IATA’s Travel Pass health app is gaining steam.
Air New Zealand, Copa Airlines, Etihad Airways, Emirates, Qatar Airways, Malaysia Airlines, RwandAir, and Singapore Airlines are among the airlines committed to conducting trails of the app which can securely store Covid test results and proof of vaccinations.
"Efficient digital management of health credentials is vital to restart. Manual processes will not be able to cope with volumes once the recovery begins," IATA said.
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Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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