2021 air travel recovery at risk from new Covid mutations and restrictions, Iata says

Last year was the worst in aviation history for air travel demand

(FILES) This file photograph taken on May 12, 2020, shows an empty waiting room and aircraft on the tarmac at Terminal 2E at Charles de Gaulle airport in Roissy-en-France, north of Paris. Global air passenger traffic plunged by an unprecedented 66 percent in 2020 due to travel restrictions imposed over the Covid-19 pandemic, an industry group said February 3, 2021. The International Air Transport Association (IATA) also warned that the emergence of new, more transmissible variants of the coronavirus were hurting the prospects for recovery this year.
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Global airlines could face a slower-than-expected recovery in travel demand this year as governments impose tighter travel restrictions to curb the spread of new Covid-19 virus strains, the industry's trade body said.

Passenger traffic may improve just 13 per cent this year, compared to 2020, in a pessimistic scenario where new travel restrictions persist, the International Air Travel Association (Iata) said. This contrasts with Iata's December forecast for a 50.1 per cent improvement in 2021 over last year.

Tough and persistent travel restrictions in response to virus mutations, pose a "severe downside risk" to Iata's  forecast of a return this year to 50 per cent of pre-crisis passenger traffic levels.

Should the lower estimate for a 13 per cent improvement materialise in 2021, that leaves the industry at 38 per cent of the pre-pandemic levels.

"Optimism that the arrival and initial distribution of vaccines would lead to a prompt and orderly restoration in global air travel have been dashed in the face of new outbreaks and new mutations of the disease," Alexandre de Juniac, Iata's director general, said. "The world is more locked down today than at virtually any point in the past 12 months and passengers face a bewildering array of rapidly changing and globally uncoordinated travel restrictions."

For the Middle East, Iata had forecast back in December a passenger traffic recovery of 43 per cent in 2021 compared to 2020. But now there is potential downside risk from new travel restrictions.

"What happened lately unfortunately is the rise of the [virus] variants and the quick actions by governments, exactly like a year ago, unilaterally closing borders, suspending flights and preventing people from moving again," Muhammad Al Bakri, Iata's regional vice president for Africa and the Middle East, said. "If countries continue to act in the same manner of closing borders and imposing harsh measures, we're back to the worst case scenario."

The airlines' lobby body urged governments to work with the industry to develop standards for vaccination, testing, and validation that will boost confidence in re-opening borders.

It touted the Iata Travel Pass as a solution. The app helps passengers manage their travel in line with government requirements for Covid-19 testing or vaccine information.

Global passenger traffic in 2020 fell by nearly two-thirds from 2019, making it the worst year in aviation history for travel demand, according to Iata.

The steepest declines came in April, a recovery during the summer stalled in the fall and turned dramatically worse in December, after the re-imposition of lockdowns due to the new virus variants.

In December, total traffic was 69.7 per cent below the same month in 2019, little improved from the 70.4 per cent contraction in November, Iata said.

Middle East carriers' annual passenger demand in 2020 was 72.9 per cent below 2019. Annual capacity fell 63.9 per cent. Load factor, a measure of how well airlines can fill seats, plummeted 18.9 percentage points to 57.3 per cent, the lowest of all the regions. December’s traffic was down 82.6 per cent compared to December 2019, improving from an 86.1 per cent drop in November.

Global air cargo fared better, decreasing 10.6 per cent in 2020 from a year ago. Still, this was the largest drop in year-on-year demand since Iata started to monitor cargo performance in 1990.

"Air cargo is surviving the crisis in better shape than the passenger side of the business," Mr de Juniac said. "For many airlines, 2020 saw air cargo become a vital source of revenues, despite weakened demand. But with much of the passenger fleet grounded, meeting demand without belly capacity continues to be an enormous challenge."