The International Air Transport Association (IATA) has published new estimates of the impact of COVID-19 on air transport and the economy in Europe in 2020, pointing to a further deterioration in revenue, job prospects and economic activity across the continent.
IATA's latest economic forecast reveals that in 2021, Europe is expected to be the worst-hit global region in terms of airline losses (-11,9 billion USD) and EBIT margins (-9,5%). Passenger traffic (measured in passenger mileage revenue, RPK) is estimated to have fallen by 70% this year, the worst performance of any region except Africa (-72%) and the Middle East (-73%).
Also, IATA expects CTR growth to be weak at 47,5% next year, lagging behind comparable regions in Asia and the Pacific (50%) and North America (60,5%). "Our projections for this and next year are a little bad for European air transport. Border restrictions and quarantine measures have halted demand, and the region has been hit by a pandemic worse than most other parts of the world. There is optimism about the vaccine, but as our forecast for next year shows, it is unlikely that this will come in time to prevent hundreds of thousands of new job losses in the industry if governments do not take immediate action. The focus must remain on rapid passenger testing so that quarantine can be eliminated and borders safely opened ”Said Rafael Schvartzman, IATA Regional Vice President for Europe.
An in-depth insight into the effects at the national level reveals that the prospects for passenger numbers and revenues in the industry are much lower in the August analysis. This inevitably leads to more jobs being compromised and additional negative economic impacts. Across Europe, more than seven million jobs have been lost or are at immediate risk due to the abolition of COVID-19.
Provisions within the EU decreased by 81% for the period up to 10 January 2021 compared to the usual curve. Economic recovery will be hampered by the loss of connectivity felt by European cities. Since 2019, overall connectivity has dropped by 68% in Frankfurt, 67% in London, 67% in Paris, 66% in Istanbul, 64% in Moscow and 53% in Amsterdam.
"We see hope in vaccines, but mass vaccinations are still a long way off, so European governments and the European Commission must act quickly to help preserve what is left of the continent’s aviation industry and air transport network. Currently, two priorities stand out. First remove the quarantine restrictions by introducing rapid testing of COVID-19 air passengers. The latest EASA and ECDC guidelines confirm that quarantine is ineffective in the current circumstances. And second, quickly agree on a revised slot regulation in line with common industry recommendations, in order to preserve air routes and competition. People are desperate to visit distant families this winter. Businesses desperately want travelers and trade. And we are all desperately dependent on government actions to safely restore freedom of travel ", Concluded Schwartzman.