The International Air Transport Association (IATA) has revised its outlook for the airline industry with a projected net loss of $118 billion this year.
However, the association believes that things would be better in 2021, with a ‘vaccine bump’ expected during the fourth quarter (Q4), although it warned that some airlines may not survive to see this recovery.
According to the global airlines regulator, the crisis of 2020 has had a very negative impact on the aviatuon industry.
IATA had initially projected losses of $84.3 billion in 2020 but recent developments have pushed its new levels to a total net loss of $118.5 billion for the year.
Speaking in an online interview, its Director-General, Alexandre de Juniac stated that airlines have done a sterling job of cutting costs, driving down expenses by some 45.8 per cent.
Chief Economist Brian Pearce presented a better outlook for 2021, saying the progress being made on vaccines has given IATA reason to be optimistic, projecting a ‘bump’ in air travel demand by at least the fourth quarter of next year.
He said: “This is based on the assumption that, by mid-2021, the vaccine will have become more widely available or that widespread testing will be in place. IATA believes that these measures will lead to opening of borders and an increase of a billion passengers over the course of the year.
“The impact of increased testing and vaccine availability is predicted to have the biggest bump in the fourth quarter of 2021. By then, IATA says that airlines could stop burning cash, and some could even become cash positive by the end of the year