Airlines operating in the Asia-Pacific region could potentially lose revenue of around $27.8 billion due to the coronavirus epidemic in China, according to the International Air Transport Association.
While the coronavirus is impacting the region’s aviation industry, Chinese carriers alone could lose around $12.8 billion in revenue.
The International Air Transport Association also estimated a potential 13 percent full-year loss of passenger demand for carriers in the Asia-Pacific region.
The impact of the coronavirus epidemic on the aviation sector is not only limited to carriers operating in the Asia-Pacific region. Carriers operating outside the region are expected to bear a revenue loss of $1.5 billion. This means the global revenue loss due to coronavirus will be around $29.3 billion.
Alexandre de Juniac, the International Air Transport Association’s director general and chief executive believes it is too early to understand the full impact of the coronavirus on the aviation market.
He told the media, “Airlines are following the guidance of the World Health Organisation (WHO) and other public health authorities to keep passengers safe, the world connected, and the virus contained. The sharp downturn in demand as a result of Covid-19 will have a financial impact on airlines, which would be severe for those particularly exposed to the China market.”
Alexandre de Juniac further revealed that global traffic will be reduced by 4.7 percent due to the epidemic which could more than offset the growth we previously forecast and cause the first overall decline in demand since the Global Financial Crisis of 2008. He believes this scenario would translate into lost passenger revenues of around $29.3 billion.
He predicts 2020 to be a tough year for the aviation industry as major carriers are forced to change or cancel routes to China or other Southeast Asian regions.