Global air passenger demand sinks further in Jan

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  • Total demand in January 2021 was down 72.0% compared to January 2019, a worse performance than the 69.7% year-over-year decline recorded in December 2020
  • International passenger demand was 85.6% below January 2019, a further drop compared to the 85.3% year-to-year decline recorded in December
  • Asia-Pacific airlines’ January traffic plummeted 94.6% compared to January 2019, unchanged from the 94.4% decline in December 2020 year-on-year
  • The industry is now expected to “burn through” $75 billion to $95 billion in cash this year, rather than turning cash positive in the fourth quarter

The start of the year doesn’t bode well for the air passenger market as demand declined further in January compared both to the pre-Covid levels of January 2019 and to December 2020, data from the International Air Transport Association (IATA) showed.

Total demand in January 2021 was down 72.0% compared to January 2019. That was worse than the 69.7% year-over-year decline recorded in December 2020.

Total domestic demand was down 47.4% versus January 2019 levels. In December it was down 42.9% on the previous year. This weakening is largely driven by stricter domestic travel controls in China over the Lunar New Year holiday period.

International passenger demand in January was 85.6% below January 2019, a further drop compared to the 85.3% year-to-year decline recorded in December.

“2021 is starting off worse than 2020 ended and that is saying a lot. Even as vaccination programs gather pace, new COVID variants are leading governments to increase travel restrictions. The uncertainty around how long these restrictions will last also has an impact on future travel. Forward bookings in February this year for the Northern Hemisphere summer travel season were 78% below levels in February 2019,” said Alexandre de Juniac, IATA’s director general and CEO.

He added: “Financial prospects for the year are worsening as governments tighten travel restrictions. We now expect the industry to burn through $75-$95 billion in cash this year, rather than turning cash positive in the fourth quarter, as previously thought.”

In the international passenger market, Asia-Pacific airlines’ January traffic plummeted 94.6% compared to the 2019 period, virtually unchanged from the 94.4% decline registered for December 2020 compared to a year ago.

The region continued to suffer from the steepest traffic declines for a seventh consecutive month. Capacity dropped 86.5% and load factor sank 49.4 percentage points to 32.6%, by far the lowest among regions.

European carriers had an 83.2% decline in traffic in January versus January 2019, worsened from an 82.6% decline in December compared to the same month in 2019.

Middle Eastern airlines saw demand plunge 82.3% in January compared to January 2019, which was broadly unchanged from an 82.6% demand drop in December versus a year ago.

North American carriers’ January traffic fell 79.0% compared to the 2019 period, up slightly from a 79.5% decline in December year to year.

Latin American airlines experienced a 78.5% demand drop in January, compared to the same month in 2019, worsened from a 76.2% decline in December year-to-year.

African airlines’ traffic dropped 66.1% in January, which was a modest improvement compared to a 68.8% decline recorded in December versus a year ago.

de Juniac called on governments to provide additional relief measures to the industry while increasing their testing capability and vaccine distribution to unlock economic activity, including travel.

“It is critical that governments build and share their restart plans along with the benchmarks that will guide them. This will enable the industry to be prepared to energize the recovery without any unnecessary delay.”

Photo by Andrew “Donovan” Valdivia on Unsplash