Airlines lost $126b as passenger traffic declines by 60%

World Air Transport Statistics (WATS) has assessed the devastating effects of the coronavirus pandemic on airlines, estimating the loss of $126 billion in 2020.

The revenue loss is on account of the 60.2 per cent decline in passenger traffic, as countries impose restrictions and flight bans to safeguard public health and safety.

WATS, a publication of the International Air Transport Association (IATA), noted that 1.8 billion passengers fIndustry-wide, air travel demand (measured in revenue passenger-kilometers, or RPKs) dropped by 65.9 per cent year-on-year. International passenger demand (RPKs) decreased by 75.6 per cent compared to 2019.

Air connectivity declined by more than half in 2020 with the number of routes connecting airports falling dramatically at the outset of the crisis and was down more than 60 per cent year-on-year in April 2020.

Total industry passenger revenues fell by 69 per cent to $189 billion in 2020, and net losses were $126.4 billion in total.

IATA’s Director General, Willie Walsh, noted the decline in air passengers transported in 2020 was the largest recorded since global RPKs started being tracked around 1950.

In 2020, a decrease of 60.2 per cent compared to the 4.5 billion that flew in 2019.

Walsh said: “2020 was a year that we’d all like to forget. But analysing the performance statistics for the year reveals an amazing story of perseverance. At the depth of the crisis in April 2020, 66 per cent of the world’s commercial air transport fleet was grounded as governments closed borders or imposed strict quarantines. A million jobs disappeared. And industry losses for the year totaled $126 billion.

“Many governments recognized aviation’s critical contributions and provided financial lifelines and other forms of support. But it was the rapid actions by airlines and the commitment of our people that saw the airline industry through the most difficult year in its history,” he said.

Operators’ key performance figures showed that airlines carried 1.8 billion passengers on scheduled services – a decrease of 60.2 per cent over 2019.

On average, there was a $71.7 loss incurred per passenger in 2020, corresponding to net losses of $126.4 billion in total.

Measured in ASKs (available seat kilometers), global airline capacity plummeted by 56.7 per cent, with international capacity being hit the hardest with a reduction of 68.3 per cent

The Middle East region suffered the largest proportion of loss for passenger traffic, with a drop of 71.5 per cent in RPKs versus 2019, followed by Europe (-69.7 per cent) and the Africa region (-68.5 per cent).

China became the largest domestic market in 2020 for the first time on record, as air travel rebounded faster in their domestic market following their efforts to control COVID-19.

In regional rankings, per passengers carried on scheduled services by airlines registered in that region, Asia-Pacific recorded 780.7 million passengers – a decrease of 53.4 per cent compared to the region’s passengers in 2019.

North America had 401.7 million passengers, down 60.8 per cent over 2019. Europe had 389.9 million passengers, down 67.4 per cent over 2019. Latin America had 123.6 million passengers, down 60.6 per cent over 2019. The Middle East had eight million passengers, a decrease of 67.6 per cent over 2019, while Africa had 34.3 million passengers, down 65.7 per cent over 2019.

The top five airlines ranked by total scheduled passenger kilometers flown were: American Airlines (124 billion), China Southern Airlines (110.7 billion), Delta Air Lines (106.5 billion), United Airlines (100.2 billion) and China Eastern Airlines (88.7 billion).

Air freight was the bright spot in air transport for 2020, as the market adapted to keep goods moving—including vaccines, personal protective equipment (PPE) and vital medical supplies, despite the massive drop in capacity from the bellies of passenger aircraft.

Industry-wide, available cargo tonne-kilometers (ACTKs) fell 21.4 per cent year-on-year in 2020. This led to a capacity crunch, with the industry-wide cargo load factor up 7.0 percentage points to 53.8 per cent. This is the highest value in the IATA series started in 1990.

Walsh said: “2020 was a year that we’d all like to forget. But analysing the performance statistics for the year reveals an amazing story of perseverance. At the depth of the crisis in April 2020, 66 per cent of the world’s commercial air transport fleet was grounded as governments closed borders or imposed strict quarantines. A million jobs disappeared. And industry losses for the year totaled $126 billion.

“Many governments recognized aviation’s critical contributions and provided financial lifelines and other forms of support. But it was the rapid actions by airlines and the commitment of our people that saw the airline industry through the most difficult year in its history,” he said.

Operators’ key performance figures showed that airlines carried 1.8 billion passengers on scheduled services – a decrease of 60.2 per cent over 2019.

On average, there was a $71.7 loss incurred per passenger in 2020, corresponding to net losses of $126.4 billion in total.

Measured in ASKs (available seat kilometers), global airline capacity plummeted by 56.7 per cent, with international capacity being hit the hardest with a reduction of 68.3 per cent

The Middle East region suffered the largest proportion of loss for passenger traffic, with a drop of 71.5 per cent in RPKs versus 2019, followed by Europe (-69.7 per cent) and the Africa region (-68.5 per cent).

China became the largest domestic market in 2020 for the first time on record, as air travel rebounded faster in their domestic market following their efforts to control COVID-19.

In regional rankings, per passengers carried on scheduled services by airlines registered in that region, Asia-Pacific recorded 780.7 million passengers – a decrease of 53.4 per cent compared to the region’s passengers in 2019.

North America had 401.7 million passengers, down 60.8 per cent over 2019. Europe had 389.9 million passengers, down 67.4 per cent over 2019. Latin America had 123.6 million passengers, down 60.6 per cent over 2019. The Middle East had eight million passengers, a decrease of 67.6 per cent over 2019, while Africa had 34.3 million passengers, down 65.7 per cent over 2019.

The top five airlines ranked by total scheduled passenger kilometers flown were: American Airlines (124 billion), China Southern Airlines (110.7 billion), Delta Air Lines (106.5 billion), United Airlines (100.2 billion) and China Eastern Airlines (88.7 billion).

Air freight was the bright spot in air transport for 2020, as the market adapted to keep goods moving—including vaccines, personal protective equipment (PPE) and vital medical supplies, despite the massive drop in capacity from the bellies of passenger aircraft.

Industry-wide, available cargo tonne-kilometers (ACTKs) fell 21.4 per cent year-on-year in 2020. This led to a capacity crunch, with the industry-wide cargo load factor up 7.0 percentage points to 53.8 per cent. This is the highest value in the IATA series started in 1990.