Airlines cut global traffic forecast on recovery setbacks

PARIS (Reuters) – Air traffic will recover more slowly than previously expected from the COVID-19 pandemic, as vaccination delays and government “risk aversion” slows the reopening of routes, global airlines body IATA said on Wednesday.

Global traffic this year will amount to 43% of pre-crisis levels based on passenger numbers and distance flown, the International Air Transport Association said, below the 51% it had forecast late last year.

IATA also predicted industry losses of $47.7 billion in 2021. While that represents an improvement on last year’s $126.4b. deficit, the organization warned that airlines would continue to need government wage support.

“This crisis is longer and deeper than anyone could have expected,” director-general Willie Walsh said.

The latest industry outlook also sheds light on the multispeed recovery underway, with large domestic markets led by the United States and China surging ahead. Europe, by contrast, will see only one-third of its 2019 traffic this year, IATA predicts.

Industry revenue is likely to grow 23% from last year’s low to $231b., it also forecast – still far below the $607b. generated a year earlier.

Cargo demand will continue to be a bright spot outpacing passenger traffic with 13.1% growth in 2021 to exceed its 2019 level, IATA predicted. Total cargo volumes are seen at 63.1 million metric tons, close to their pre-crisis peak in 2018.