FILE PHOTO: The International Air Transport Association (IATA) logo is seen at the International Tourism Trade Fair ITB in Berlin, Germany, March 7, 2018. REUTERS/Fabrizio Bensch/File Photo
PARIS鈥擥lobal airlines cut their coronavirus recovery forecast on Tuesday, saying it would take until 2024鈥攁 year longer than previously expected鈥攆or passenger traffic to return to pre-crisis levels.
In an update on the pandemic鈥檚 crippling impact on air travel, the International Air Transport Association (IATA) cited slow virus containment in the United States and developing countries and a weaker outlook for corporate travel.
Lingering travel barriers and new restrictions in some markets are also weighing on nearer-term prospects, IATA said, cutting its 2020 passenger numbers forecast to a 55% decline 鈥� sharper than the 46% drop predicted in April.
鈥淭he second half of this year will see a slower recovery than we鈥檇 hoped,鈥� IATA Chief Economist Brian Pearce said. June passenger numbers were down 86.5% year-on-year, the organization said, after a 91% contraction in May.
A surprise move by Britain to quarantine arrivals from Spain has created lot of uncertainty, Pearce said. 鈥淭hat is clearly going to be an issue with the recovery.鈥�
Recovery prospects are weakened by the spread of COVID-19 in the United States and developing countries together representing 40% of global air travel, IATA said.
Business travel may also face a sustained slump, threatening the profitability of long-haul airlines and routes as corporate clients rein in spending and make greater use of video-conferences that have become the norm during lockdowns.
鈥淚t will remain to be seen whether we see a recovery to pre-crisis business travel patterns,鈥� Pearce said. 鈥淥ur concern is that we won鈥檛.鈥�
Long-haul carriers may need to rely more heavily on cargo to maintain the viability of some routes because of lower business demand, he said.
鈥淔or many network airlines, the premium-paying passengers were essentially the ones who drove the profitability.鈥�