IATA declares 2020 as the worst year for aviation industry

Published on : Thursday, February 4, 2021

The International Air Transport Association (IATA) has announced full-year global passenger traffic results for 2020 showing that demand (revenue passenger kilometres) fell by 66 per cent compared to the full year of 2019 and is considered to be the sharpest traffic decline in aviation history so far.

Furthermore, forward bookings have been falling sharply since late December. According to IATA figures, international passenger demand in 2020 was 76 per cent below 2019 levels. It also informed that capacity (measured in available seat kilometres) declined 68 per cent and load factors fell 19 percentage points to 63 per cent. Domestic demand in 2020 was down 49 per cent compared to 2019.

It was reported that capacity contracted by 36 per cent and load factor dropped 17 percentage points to 67 per cent in the domestic market. According to data, the total traffic in December was 69.7 per cent below the same month in 2019, little improved from the 70.4 per cent contraction in November but capacity was down 57 per cent and load factor fell 24.6 percentage points to 57 per cent.

Bookings for future travel made in January were down 70 per cent compared to a year-ago, putting further pressure on airline cash positions and potentially impacting the timing of the expected recovery. The IATA baseline forecast for 2021 is for a 50 per cent improvement on 2020 demand that would bring the industry to 50.6 per cent of 2019 levels. However, there is also a severe downside risk if more severe travel restrictions continue to remain constant in response to new COVID-19 variants. If such a scenario materialise, it is likely that demand improvement could be limited to just 13 per cent over 2020 levels, leaving the industry at 38 per cent of 2019 levels.

Alexandre de Juniac, Director General, IATA said in a press statement that the last year was a catastrophe for the aviation industry and there is no other way to describe it. He mentioned recovery was over the Northern hemisphere summer season stalled in autumn and the situation turned dramatically worse over the year-end holiday season, as more severe travel restrictions were imposed in the face of new outbreaks and new strains of COVID-19.

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