Disruption caused by the coronavirus could cost global airlines more than $100bn in lost revenues this year as carriers slash flights in response to the outbreak, the industry’s body has warned.
The International Air Transport Association said it expects passenger carriers to lose between $63bn and $113bn in revenue in 2020, a much worse picture than it painted just two weeks ago when it predicted a hit of less than $30bn.
“Since that time, the virus has spread to over 80 countries and forward bookings have been severely impacted on routes beyond China,” Iata said in a statement.
Its new scenarios are dependent on how bad the outbreak becomes, ranging from quick containment to a broader spread of the Covid-19 virus.
Airlines have felt some of the worst economic impacts of the outbreak. Carriers have cut flights and their outlooks as passenger demand has slid, sending shares in major airlines tumbling.
The virus helped push Europe’s largest regional carrier Flybe into administration in the early hours of Thursday morning, while low-cost carrier Norwegian withdrew its financial guidance hours later as it announced plans to cancel 22 flights.
The industry body called on world governments to consider helping embattled carriers through the crisis.
“Airlines are doing their best to stay afloat,” said Alexandre de Juniac, Iata’s chief executive. “As governments look to stimulus measures, the airline industry will need consideration for relief on taxes, charges and slot allocation. These are extraordinary times.”