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IATA’s new forecast warns of darker near term outlook
October 2nd 2020
International Air Transport Association (IATA) director general and CEO, Alexandre de Juniac, said this week airlines faced a grim northern winter as travel restrictions kept demand hugely depressed in August. Read More »
The airline lobby group's monthly traffic figures showed demand for the month declined 75.3% compared with a year ago.
It was a slight improvement on the 79.5% drop in revenue passenger kilometres (RPK) for July, but IATA said the recovery in air passenger services was "brought to a halt” by the re-introduction of government imposed travel restrictions after new COVID-19 outbreaks in a number of key markets.
In a further blow to improving the industry’s dismal passenger numbers, IATA said forward bookings for air travel in the fourth quarter showed the recovery since the low point of April would continue to falter.
IATA's latest forecast was for global RPKs to be down by 68% in December, some 13 percentage points worse off than its previous estimate of a 55% decline.
"The near-term industry outlook has actually gotten darker, something I would not have believed possible just a few months ago," de Juniac told reporters this week.
"In normal times, the peak summer travel season provides airlines with a cash cushion to help weather the slower autumn and winter seasons. This year the industry is heading into the slow season in the worst financial position in its history."
The Asia-Pacific suffered a 69.2% drop in RPKs in August. Capacity, measured by available seat kilometres (ASK), dropped 60.3% and passenger load factor slipped 19 percentage points to 65%.
In terms of international traffic, the Asia-Pacific was the worst performing region globally in August with a 95.9% drop in RPKs.
Mainland China’s domestic market was a bright spot in the region with RPKs in August "only" 19.1% below 2019 levels. The same could not be said of Australia (- 91.5%), India (-73.6%) and Japan (-68.6%).
"International demand recovery is virtually non-existent and domestic markets in Australia and Japan actually regressed in the face of new outbreaks and travel restrictions," de Juniac said.
IATA's monthly cargo figures, also published this week, showed international cargo demand, measured by cargo tonne kilometres (CTK), fell 12.6% in August, compared with the same month last year. This was an improvement from the 14.4% year-on-year decline in CTKs in July.
The report said improvements in cargo markets were hampered by capacity constraints, with belly capacity for international air cargo on passenger flights down 67% in August compared with a year earlier. A 28.1% increase in dedicated freighter capacity had not made up the shortfall
Asia-Pacific airlines suffered an 18.3% drop in international CTKs in August, IATA said.
