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Industry rebound to see revenues reaching US$782 billion this year, up 54.5% y-o-y and 93.3% above 2019 levels, IATA reports
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Asia-Pacific airlines are lagging amid strict travel restrictions, notably in China, and uneven vaccine rollout, the airline group says
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Cargo to account for US$121 billion of revenues, down from US$204 billion in 2021
Global air transport revenues are seen reaching US$782 billion this year, up 54.5% year on year and 93.3% above 2019 levels as the industry rebounds. Asia-Pacific airlines are lagging amid strict and enduring travel restrictions notably in China, and an uneven vaccine rollout.
Cargo revenues are expected to account for US$191 billion of industry revenues, down slightly from the US$204 billion recorded in 2021, but nearly double the US$100 billion achieved in 2019, the International Air Transport Association said on June 20.
As the trading environment softens slightly, cargo yields are expected to decline 10.4% y-o-y, IATA said. That only partially reverses the yield increases of 52.5% in 2020 and 24.2% in 2021, the group said in a press release.
Overall, the air cargo industry is expected to carry more than 68 million tons of cargo in 2022, a record high, IATA said.
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“Airlines are resilient. People are flying in ever greater numbers. And cargo is performing well against a backdrop of growing economic uncertainty. Losses will be cut to US$9.7 billion this year and profitability is on the horizon for 2023,” said Willie Walsh, IATA’s director general.
“It is a time for optimism, even if there are still challenges on costs, particularly fuel, and some lingering restrictions in a few key markets,” Walsh said.
The meeting brought together executives from its 290 member airlines across the globe that account for 83% of the world’s total air passenger volume.
As more countries lift restrictions aimed at curbing the spread of COVID-19 and open their borders to foreign travellers, people who have mostly been unable to travel are now driving the global travel industry recovery, IATA said.
As the COVID restrictions diminish, travel demand should increase quickly, the group said. It forecast that net losses in 2022 will decline to US$8.9 billion while demand, measured in revenue passenger kilometers (RPKs), will reach 73.7% of the 2019 pre-crisis levels and capacity, 81.5%, the group said.
Flights operated in 2022 are expected to total 33.8 million, or 86.9% of the 38.9 million flights in 2019, IATA said.
Scheduled passenger numbers are expected to reach 3.8 billion, with RPKs growing 97.6% compared with 2021, reaching 82.4% of 2019 traffic. As pent-up demand is released with the easing of travel restrictions, yields are expected to rise 5.6%. That follows a yield evolution of minus 9.1% in 2020 and plus 3.8% in 2021.
North America is expected to remain the strongest-performing region and the only region to return to profitability in 2022, IATA said in its review of regional industry performances.
Supported by the large US domestic market and the re-opening of international markets, including the North Atlantic, net profit is forecast to be US$8.8 billion in 2022, IATA said. Demand, in RPKs, is expected to reach 95.0% of pre-crisis 2019 levels, and capacity, 99.5%.
In Europe, the Russia-Ukraine war will continue to disrupt travel patterns within the continent and between Europe and Asia-Pacific.
However, the war is not expected to derail the travel recovery, with the region edging closer to profitability in 2022, with a net loss of US$3.9 billion forecast. Demand, expressed in RPKs, is expected to reach 82.7% of pre-crisis 2019 levels, and capacity, 90%, IATA said.
The group announced an upgrade to its outlook for the airline industry’s 2022 financial performance as the pace of recovery from the COVID-19 crisis quickens. Forecast highlights include industry losses that are expected to drop to US$9.7 billion, an improvement from an US$11.6 billion loss in October 2021.
That’s a huge improvement from losses of US$137.7 billion in 2020 and US$42.1 billion in 2021. Industry-wide profitability in 2023 appears within reach with North America already expected to deliver an US$8.8 billion profit in 2022, IATA said.
