Thursday, October 28 2021
Few Clouds
15.8°C New York

1 € = $ 1.1606
1 $ = € 0.8616

Airlines see 'apocalypse now' as loss estimate reaches 252bn dollars

The world's airlines are expecting to lose 252 billion dollars in revenues because of the coronavirus pandemic this year, the International Air Transport Association (IATA) said on Tuesday.

Image result for Airlines corona

"For airlines, it’s apocalypse now," IATA Director General Alexandre de Juniac said in Geneva.

The latest forecast is significantly more dire than the previous loss estimate of up to 113 million that the industry group had issued in early March, before countries around the world introduced sweeping new travel restrictions.

According to the new projection, global passenger revenues would be 40 per cent lower in 2020 than last year.

IATA chief economist Brian Pearce said that the situation is expected to improve again 2021, but he cautioned that the upturn would be dampened by the recession that will come in the wake of the pandemic.

"Airlines need 200 billion dollars in liquidity support simply to make it through," de Juniac said.

While some governments had already stepped forward with aid, many more still need to follow suit, he added, calling for direct financial aid as well as loan support and tax relief.

Low-cost airline Norwegian Air said on Tuesday it had secured approval from two Nordic banks for a credit guarantee under terms launched last week by the Norwegian government amid the coronavirus outbreak.

With the 10-per-cent guarantee from the unnamed banks, the carrier aimed to draw on the first tranche of 300 million kroner (27 million dollars) under the government's loan guarantees for the country's airlines.

The funds "will create necessary headroom to pursue the remaining tranches of the guarantee scheme," the carrier said.

Norwegian is eligible for half of the 6 billion kroner under the scheme the government launched for the country's airlines, amid the drastic drop in demand for air travel.

The carrier has cancelled 85 per cent of its flights and temporarily laid off about 90 per cent of its staff, about 7,300 employees, over "stagnating demand and enforced travel restrictions."

Due to its limited service, Norwegian Air is mainly operating domestic flights in Norway and Sweden, and between the Nordic capitals.