Economy

Asia Pacific carriers to lose $27.8 billion revenue due to coronavirus: IATA

Asia Pacific carriers to lose $27.8 billion revenue due to coronavirus: IATA”

Total global revenue loss is estimated at $29.3 billion while passenger demand will likely drop 0.6 percent against an earlier forecast of a 4.1 percent increase, the association said.

Of that figure, IATA predicts that carriers in China are set to lose revenue of $12.8 billion in their home market alone.

But carriers based outside the region are also expected to take a hit of nearly £1.2bn ($1.5bn) from lost revenue on scrapped flights to and from China.

IATA said it had based its estimates on the slump in demand that was seen during the Sars (severe acute respiratory syndrome) outbreak in 2003. That was once characterized by means of a six-month length that noticed a pointy fall in call for adopted by means of an similarly fast restoration.

That year Sars was responsible for the 5.1 per cent fall in demand for airlines in the Asia-Pacific region.

It also assumes the public health emergency remains centered in China and warns the impact will be bigger if spreads more widely to other Asia-Pacific markets.

The Coronavirus is also impacting the global airline industry's bottom line. Stopping the spread of the virus is the top priority...

Alexandre de Juniac, CEO of the IATA, warned of a "tough year for airlines" as a result of a "sharp downturn" in passenger demand.

"This will be the first time since the 2008-2009 financial crisis that demand for air travel has declined, " De Juniac said.

But airlines are already taking "difficult decisions" to cut capacity or even routes, the IATA noted. IATA initially expected that the region's airline demand will increase by 4.8% on the year.

IATA called on governments to follow worldwide health regulations so there was an effective global approach to controlling the outbreak. "We have learned a lot from previous outbreaks".

Qantas Airlines said the virus could carve up to $100 million of pre-tax profit from the second half of the company's fiscal year. And that is reflected in the IHR. The Singapore government, for example, is allocating S$112 million (US$79.9 million) to provide financial relief to airlines struggling to economically maintain connectivity. "Airlines and governments are in this together". Relief on airport costs will help maintain vital air connectivity.

See the World Health Organization website for latest advice. "Observing these simple measures should keep flying safe for all", said Dr David Powell, IATA's Medical Advisor.

An arriving passenger's temperature is checked February 4, 2020, at the Shanghai Pudong International Airport in Shanghai. And when you travel wash your hands frequently and don't touch your face.



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