IATA Sees ‘Bleak’ Prospects for Air Transport Amid Quarantines

 - January 12, 2021, 9:42 AM

This story is part of AIN's continuing coverage of the impact of the coronavirus on aviation.

The International Air Transport Association’s persistent calls for a Covid-19 testing regime to replace quarantine requirements have gone unanswered by governments, prompting IATA director general Alexandre de Juniac to characterize near-term prospects as “bleak” and IATA chief economist Brian Pearce to expect more airline bankruptcies during the first half of the year. Speaking during the latest of IATA’s series of conference calls on the effects of the pandemic on airlines, de Juniac reiterated calls to governments for a more balanced approach to reopening borders and to give up what he portrayed as aspirations for a “zero-Covid world.”

“That's an impossible task, which comes with severe consequences, the full extent of which it would be impossible to calculate,” said de Juniac. “But with this approach, we know for sure that first, the travel and tourism economy will not recover.”

De Juniac specifically named Canada, the UK, Germany, and Japan among countries that added testing to Covid-19 measures while maintaining quarantines.

“In other words, they have chosen policy measures that will shut down travel,” added de Juniac. “This approach tells us that these governments are not interested in managing a balanced approach to the risk of Covid-19. Science tells us that travelers will not be a significant factor in the community transmission if testing is used effectively, but most governments have tunnel vision,” he concluded.

Pearce called the near $120 billion loss airlines suffered during 2020 as “catastrophic” if not for the $197 billion in Covid relief to which governments committed during the period. While recounting that airlines that either failed or restructured during the crisis numbered a relatively low “40 or 50,” he warned of a far worse scenario during the first half of the year, particularly among carriers that have not managed to preserve significant levels of cash.

“The next six months, before we see vaccines making a significant difference to travel, is going to be really difficult,” said Pearce.

Facing a slowing recovery of passenger demand resulting from surging Covid cases and related travel restrictions since the Northern Hemisphere’s summer travel season reached a full stop in November, airlines saw almost identical revenue passenger kilometer declines from a month earlier, reported IATA last Thursday. Falling 70.3 percent from the same month a year earlier, November 2020 RPKs went virtually unchanged from the 70.6 percent year-over-year decline recorded in October. November capacity fell 58.6 percent below the previous year’s levels and load factor fell 23 points to 58 percent—a record low for the month.

“The already tepid recovery in air travel demand came to a full stop in November,” remarked de Juniac in a statement. “That’s because governments responded to new outbreaks with even more severe travel restrictions and quarantine measures. This is clearly inefficient. Such measures increase hardship for millions. Vaccines offer the long-term solution. In the meantime, testing is the best way that we see to stop the spread of the virus and start the economic recovery. How much more anguish do people need to go through—job losses, mental stress—before governments will understand that?”