Improving demand for air freight is compensating for still-declining passenger airline traffic, according to statistics for September published on Wednesday by the International Air Transport Association (IATA). The group’s chief economist, Brian Pearce, warned that in regions such as Europe, where a second wave of Covid infections is escalating, more challenging business conditions have been seen throughout October and into early November.
During September, global air freight demand measured in cargo tonne-kilometers was 8 percent below levels recorded in September 2019, representing a positive trend compared with revenue passenger kilometers, which saw a decline of almost 73 percent. According to Pearce, load factors for cargo operations have been increasing by around 10 percent, especially with the withdrawal of many long-haul passenger services using widebody aircraft that typically carry some freight. IATA’s figures showed significant geographic variations with North Pacific air freight routes now seeing little adverse impact from the Covid crisis, while links between Europe and Asia and across the North Atlantic are not doing as well.
September saw similar variations in passenger traffic, with demand in Europe staying in the doldrums. “The second [Covid] wave is hitting hard,” Pearce told reporters. “The situation deteriorated dramatically and it is a very different situation in Asia where the virus is now largely under control,” he maintained.
IATA repeated its case that underlying demand to travel is still present among consumers, who continue to be discouraged from booking flights by what they view as very disruptive and inconsistent quarantine requirements. “Latin America has recently shown that by allowing entry with testing [instead of having quarantines] can boost travel,” said Pearce.
According to IATA director Alexandre de Juniac, ICAO is expected to issue new recommendations on passenger Covid testing protocols on November 10. Nonetheless, he said that he expects flight bookings to remain significantly down while expressing some optimism that international health authorities may soon be able to agree a common approach to a testing regime that would make airline services more viable for travelers.
In the meantime, IATA acknowledged that most airlines are still burning through cash at an unsustainable rate, even though the $50 billion figure reported for its members in the second quarter of 2020 is expected to be somewhat lower for the third quarter. “So having support from governments is again becoming critical, even changing from being a matter of survival for airlines to making it economically viable to restart routes and networks,” concluded de Juniac.
On November 24, during its annual general meeting, IATA will publish its latest outlook for the air transport sector in 2021.