Coronavirus could cost global airline industry USD 113 billion revenue in 2020: IATA

IATA said that the more dire prediction amounts to a 19 per cent loss in worldwide passenger revenues.

Published: 05th March 2020 04:46 PM  |   Last Updated: 06th March 2020 11:52 AM   |  A+A A-

A Boeing 747 of Asiana Airlines lands at the Frankfurt airport

A Boeing 747 of Asiana Airlines lands at the Frankfurt airport. (File photo | AP)

By Arshad Khan
Express News Service

NEW DELHI: The Coronavirus outbreak is going to have a much bigger impact on the global air transport industry compared to the previous estimates.

The International Air Transport Association (IATA) on Thursday said now it sees 2020 global revenue losses for the passenger business of between USD 63 billion (in a scenario where COVID-19 is contained in current markets with over 100 cases as of March 2) and USD 113 billion (in a scenario with a broader spreading of COVID-19). 

IATA’s previous analysis in February put lost revenues at USD 29.3 billion based on a scenario that would see the impact of COVID-19 largely confined to markets associated with China. However, since that time, the virus has spread to over 80 countries, including India, and forward bookings have been severely impacted on routes beyond China.

Air India and IndiGo have extended flight cancellation to China and Hong Kong by three months. Vistara cancelled over 50 flights to Singapore and Bangkok. Further, Air India has cut flights to Italy, Japan and South Korea and planning to operate a smaller aircraft to Saudi Arabia.

Around 30 people have been tested positive for the virus in a span of four days in India and global death toll nearing 3,300, many passengers are cancelling their trips. 

According to travel portal Yatra, future bookings to Southeast Asia and Italy is anticipated to drop by 20-25 per cent. Travel agents estimate that flight reservations to Delhi alone has dropped by over 10 per cent in the last two days.

"In little over two months, the industry’s prospects have taken a dramatic turn for the worse...but if we see the impact contained to a few markets and a USD 63 billion revenue loss, or a broader impact leading to a USD 113 billion loss of revenue," said Alexandre de Juniac, IATA’s director general and CEO.

Industry needs relief on taxes

These are extraordinary times, the industry will need consideration for relief on taxes, charges and slot allocation from the governments, said Juniac