Airline passenger revenue is set to plunge by USD 314 billion in 2020, which is a decline of 55 per cent from 2019 due to coronavirus as per the updated analysis released by the International Air Transport Association (IATA).
On March 24, the IATA had predicted an estimated loss of USD 252 billion in revenues, which is 44 per cent decline in passenger for airline industry due to severe travel restrictions lasting more than three months as governments across the world try to contain the disease.
As per a release by IATA, the world is heading for a recession. The economic shock of the COVID-19 crisis is expected to be at its most severe in Q2 when the GDP is expected to shrink by 6 per cent (by comparison, GDP shrank by 2 per cent at the height of the global financial crisis). Passenger demand closely follows GDP progression. The impact of reduced economic activity in Q2 alone would result in an 8 per cent fall in passenger demand in the third quarter."
The release added: "Travel restrictions will deepen the impact of the recession on demand for travel. The most severe impact is expected to be in Q2. As of early April, the number of flights globally was down 80 per cent as compared to 2019 in large part owing to severe travel restrictions imposed by governments to fight the spread of the virus."
Alexandre de Juniac, IATA's Director General and CEO, said: "The industry's outlook grows darker by the day. The scale of the crisis makes a sharp V-shaped recovery unlikely. It will be a U-shaped recovery with domestic travel coming back faster than the international market. We could see more than half of passenger revenues disappear.
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