Global airlines expect losses in 2022 to drop to $11.6bn after registering a $51.8bn loss in 2021 as aviation makes an uneven recovery from the coronavirus pandemic, the industry body Iata said at its annual general meeting in Boston on Monday.
Global carriers will shoulder total accumulative losses of $201bn in the period between 2020 to 2022, as a result of the pandemic that brought air travel to a halt, Iata said.
It revised upwards the loss for 2020 to $137.7bn from earlier estimates of $126.4bn.
"The magnitude of the Covid-19 crisis for airlines is enormous," Willie Walsh, Iata's director general, told the in-person gathering of airline chief executives for the first time in two years.
"People have not lost their desire to travel as we see in solid domestic market resilience. But they are being held back from international travel by restrictions, uncertainty and complexity."
While domestic travel has started to improve, long-haul trips that are essential for many major airlines have yet to show any meaningful recovery.
However, the aviation veteran did offer some optimism on the outlook for the industry.
"We are well past the deepest point of the crisis," Mr Walsh said. "While serious issues remain, the path to recovery is coming into view. Aviation is demonstrating its resilience yet again.”
Demand for domestic flights is leading the recovery and is expected to reach 93 per cent of pre-crisis levels in 2022, Iata said.
International travel continues to lag behind due to border restrictions and is expected to reach 44 per cent of pre-pandemic levels next year.
Passenger traffic is forecast to reach 2.3 billion in 2021, growing to 3.4 billion in 2022, which is similar to 2014 levels and "significantly below" the 4.5 billion travellers in 2019 before the pandemic hit, according to Iata.
Passenger revenue will reach $227bn in 2021, rising to $378bn in 2022. Airline yields are expected to grow by 2 per cent in 2021 and a further 10 per cent in 2022.
Overall revenues in 2021 should rise 26.7 per cent year-on-year to $472bn, which is comparable to 2009 levels, Iata said. Revenue will further rise 39.3 per cent in 2022 to $658bn, which is similar to 2011 levels.
While carriers in all the global regions will narrow their loss in 2022 compared to this year, only those in North America will turn a profit next year, Iata said.
Middle East carriers are forecast to report smaller loss of $4.6bn in 2022, compared to $6.8bn in 2021.
"Without large domestic markets, the region's major carriers rely significantly on connecting traffic, especially to Asia-Pacific which has been slow to re-open to international traffic," the Iata report said.
Air cargo remains a bright spot for the industry.
Demand for air cargo is expected to continue, with 2021 demand at 7.9 per cent above 2019 levels, growing to 13.2 per cent above 2019 levels in 2022.
Mr Walsh called on governments to continue extending wage support measures and airport slot waivers to airlines.
Governments across the world have provided financial aid to airlines of $243bn since the beginning of the pandemic until the end of September 2021, Iata said.
"Our industry is rising from the destruction of Covid-19 and the challenges of sustainability and without a doubt we will fly again," Mr Walsh concluded.
China Eastern Airlines will host the next 78th Iata annual general meeting in Shanghai on June 19 to 21, Iata said.