The losses of airlines globally are expected to be down to $9.7 billion this year from $52 billion in 2021, and industry-wide profit should be on the horizon in 2023, said Willie Walsh, Director General, International Air Transport Association (IATA), on Monday, at the industry body’s annual general meeting in Doha.

IATA represents around 290 airlines comprising 83 per cent of the global air traffic.

Challenging environment

Walsh, in his inaugural speech, said while the outlook for airlines globally is positive, the business environment remains challenging. “Our outlook expects [global] GDP to grow 3.4 per cent this year. Not bad, but down on earlier forecasts,” Walsh noted.

The World Bank expects energy prices to soar 50 per cent compared to 2021 levels, he added. “Russia’s illegal invasion of Ukraine has destabilised globalisation, threatened the world’s food supply, and recreated a geopolitical divide not seen since the Cold War,” he stated.

“Fixing battered balance sheets of airlines carrying debts of $650 billion will be a monumental challenge,” he said, while underscoring that “there is no way to sugar coat the bitter economic and political realities the airlines face globally”.

“But the desire to travel and the necessity of moving goods are both solid. Our industry is now leaner, tougher and nimbler. Our latest analysis shows losses in 2021 close to $42 billion — a huge loss — but down from our earlier estimate of $52 billion,” he added.

Speaking specifically about the Asia-Pacific region, IATA said strict and enduring travel restrictions (notably in China), along with an uneven vaccine rollout, have seen the region lag in the recovery to date. As the restrictions diminish, travel demand is expected to increase quickly. Net losses in 2022 are forecast to decline to $8.9 billion. Demand (revenue passenger-kilometre) is expected to reach 73.7 per cent of pre-Covid (2019) levels and 81.5 per cent capacity.

(The writer is in Doha at the invitation of IATA)

social-fb COMMENT NOW