IATA Calls For Stimulation Measures Following "Disappointingly Slow" Pax Demand In OCT
Anna Kroupina, Open Jaw
Alexandre de Juniac
New data from the International Air Transport Association (IATA) reveals a "disappointingly slow" recovery of passenger demand in OCT.
Total demand was down 71% compared to OCT 2019, a modest improvement from the 72% year-to-year decline recorded in SEP. Capacity was down 60% compared to a year ago and load factor fell 22% to 60%.
“Fresh outbreaks of COVID-19 and governments’ continued reliance on heavy-handed quarantines resulted in another catastrophic month for air travel demand. While the pace of recovery is faster in some regions than others, the overall picture for international travel is grim,” said Alexandre de Juniac, IATA’s Director General and CEO.
International passenger demand in OCT was down 88% compared to the same month last year, remaining unchanged from year-to-year decline recorded in SEP. Domestic demand drove what little recovery there was, with OCT domestic traffic down 41% compared to the prior year. This was improved from a 43% year-to-year decline in SEP.
For North American carriers, traffic was down 88% in OCT, a slight improvement from a 91% decline in SEP.
“This crisis is unrelenting. Our latest economic outlook is for airlines to lose US$118.5 billion this year, or $66 for every passenger carried," de Juniac said. "Assuming borders re-open by mid-2021, the industry will ‘only’ lose $38.7 billion in 2021. Now is the time for governments to step up. The $173 billion of support provided to date has enabled the industry to survive, but more is required to carry the industry through to next summer."
IATA Outlines New Measures To Stimulate Demand
It's within this market outlook that IATA is calling on governments to add market stimulation measures to the support they are giving to keep aviation financially viable.
“Financially viable airlines will be needed to lead the economic recovery from the depths of the COVID-19 crisis. With potential to safely re-open borders and revive travel with testing, governments will need to add measures that stimulate demand. Such targeted initiatives will help generate revenues, avoid adding debt to airlines, and immediately generate economic activity across the value chain,” said Alexandre de Juniac, IATA’s Director General and CEO.
IATA is urging governments to introduce the following stimulation measures:
Temporary waivers of government charges, taxes and fees to airlines and passengers
Route subsidies for flights to local/regional destinations to support connectivity for rural communities and business
Financial incentives in the form of rewards for operating flights, which can support airlines while load factors are too low
Advance ticket purchases that governments can use for future trips or distribute to the travelling public in the form of vouchers to support travel and tourism
Passenger travel subsidies in the form of vouchers for passengers or as a percentage cash-back on overall travel costs
“A robust economic recovery needs people to start travelling again," de Juniac said.
"Every job in aviation supports a further 29 jobs, demonstrating the broad impact that re-connecting the world will have. When people travel, economies prosper and grow."
Anna Kroupina Journalist
Anna is OJ's newest member and she joins the team as a writer/reporter. She co-writes the daily news and covers events. Although she's new to the industry, pursuing a career path in travel/tourism has been a goal since her first family road trip to the Florida Keys sparked a desire to discover the world and this exhilarating, fast-paced industry.