IATA Estimates a $113 Billion Airline Loss Due to Cornavirus

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The International Air Transport Association (IATA) is warning of the potential economic impact on airlines of the travel and flight bans imposed on airlines by the USA and Europe on travellers from Schengen Area.  The suspension of inbound travel from over 26 countries in Europe will be  effective from Friday 13th March 2020.

According to IATA, during 2019, there were 200,000 flights scheduled between the US and the Schengen Area, equivalent to around 550 per day. These handled around 46 million passengers (about 125,000 travellers per day).

IATA estimated that the Corona virus crisis could cut US$113 billion of revenue. The total value of the US-Schengen airline market in 2019 was US$20.6 billion, with US-Germany (US$4 billion), US-France (US$3.5 billion) and US-Italy (US$2.9 billion) being the biggest losers.

Director General and CEO Alexandre de Juniac said: “This will create enormous cash-flow pressures for airlines. Airlines will need emergency measures to get through this crisis. Air transport is vital, but without a lifeline from governments we will have a sectoral financial crisis piled on top of the public health emergency.”

IATA noted that the World Health Organisation (WHO) continues to advise against the application of travel or trade restrictions to countries experiencing outbreaks.

The Europe-to-United States travel ban will have far reaching implications for the global aviation industry and it is estimated that 6,747 flights and roughly two million seats will be affected each way over the next four weeks.  Of the US airlines, Delta and United Airlines are the most affected and account for 31% of the affected flights.  Lufthansa is the most affected European airline (13% of European flights).

The most affected European countries are Germany, France and the Netherlands, which service 57 % of all flights between the Schengen area and US.

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