Airlines across the globe will need to cut more jobs in order to stay afloat and weather the Covid-19 storm, the International Air Transport Association (IATA) said in its latest report.
Global airline revenue in 2021 will be down by 46 percent compared to $838 billion recorded in 2019, IATA said. In its previous analysis, IATA said that revenues for 2021 will be down around 29 percent compared to 2019. This was based on expectations for a demand recovery commencing in the fourth quarter of 2020, which has not happened.
Alexandre de Juniac, IATA’s director general and chief executive, told the media, “The fourth quarter of 2020 will be extremely difficult and there is little indication the first half of 2021 will be significantly better, so long as borders remain closed and/or arrival quarantines remain in place. Without additional government financial relief, the median airline has just 8.5 months of cash remaining at current burn rates. And we can’t cut costs fast enough to catch up with shrunken revenues.”
“If airlines are coming to a point at which they cut these jobs, of pilots and flight attendants, because they cannot do otherwise, I would ask the pilots and the flight attendants to accept this is very difficult rule, and accept it to help the airline industry to survive.”
Describing the issue as a catastrophe, he further called for government intervention and bailout packages for the airline industry across the globe.
Earlier this month, IATA warned that the global airline industry will burn through $77 billion in cash during the second half of 2020 despite the resumption of operations.