IATA: 2020 Worst Year in History for Air Travel Demand

The International Air Transport Association (IATA) on Wednesday said 2020 was a catastrophe for passenger demand, the world’s connectivity and people’s freedom to travel, following the impact of the coronavirus (Covid-19) pandemic on air travel.

The association, during a media briefing, announced full-year global passenger traffic results for 2020 showing that demand (revenue passenger kilometers or RPKs) fell by 65.9 percent compared to the full year of 2019, “by far the sharpest traffic decline in aviation history”. Furthermore, forward bookings have been falling sharply since late December.

During the briefing, the association gave a presentation revealing the severe situation of the global air transport industry:

• International passenger demand in 2020 was 75.6 percent below 2019 levels. Capacity (measured in available seat kilometers or ASKs) declined 68.1 percent and load factor fell 19.2 percentage points to 62.8 percent.
• Domestic demand in 2020 was down 48.8 percent compared to 2019. Capacity contracted by 35.7 percent and load factor dropped 17 percentage points to 66.6 percent.
• December 2020 total traffic was 69.7 percent below the same month in 2019, little improved from the 70.4 percent contraction in November. Capacity was down 56.7 percent and load factor fell 24.6 percentage points to 57.5 percent.
• Bookings for future travel made in January 2021 were down 70 percent compared to a year-ago, putting further pressure on airline cash positions and potentially impacting the timing of the expected recovery.

Regarding global air freight markets, IATA’s data showed that demand for air cargo decreased by 10.6 percent in 2020, compared to 2019 – the largest drop in year-on-year demand.

Forecast for 2021

IATA’s baseline forecast for 2021 is for a 50.4 percent improvement on 2020 demand that would bring the industry to 50.6 percent of 2019 levels.

While the association’s view remains unchanged, there is a severe downside risk if more strict travel restrictions in response to new variants persist.

According to IATA, should such a scenario materialize, demand improvement could be limited to just 13 percent over 2020 levels, leaving the industry at 38 percent of 2019 levels.

“Last year was a catastrophe. There is no other way to describe it. What recovery there was over the Northern hemisphere summer season stalled in autumn and the situation turned dramatically worse over the year-end holiday season, as more severe travel restrictions were imposed in the face of new outbreaks and new strains of COVID-19,” said Alexandre de Juniac, IATA’s Director General and CEO.

“Optimism that the arrival and initial distribution of vaccines would lead to a prompt and orderly restoration in global air travel have been dashed in the face of new outbreaks and new mutations of the disease,” said de Juniac.

IATA’s CEO stressed that “the world is more locked down today than at virtually any point in the past 12 months” and that passengers face a bewildering array of rapidly changing and globally uncoordinated travel restrictions.

“We urge governments to work with industry to develop the standards for vaccination, testing, and validation that will enable governments to have confidence that borders can reopen and international air travel can resume once the virus threat has been neutralized,” he said, adding that the IATA Travel Pass will help the air travel restart process.

“In the meantime, the airline industry will require continued financial support from governments in order to remain viable,” de Juniac concluded.