IATA: Industry set to lose US$201 billion for 2020-2022 due to COVID-19 pandemic, quarantines

Cargo still has a bright outlook but pax traffic will remain depressed for years

Scenes like this one at Suvarnabhumi Airport are becoming rare as travel starts to resume in Asia and elsewhere. (PHOTO: Shutterstock)

The International Air Transport Association (IATA) announced its latest outlook for airline industry financial performance showing the industry is likely to suffer at least US$201 billion in cumulative losses for 2020-2022 due to the COVID-19 pandemic and near shut-down in international aviation.

At the group’s annual general meeting in Boston, IATA said net industry losses are expected to fall to US$11.6 billion in 2022 after a US$51.8 billion loss in 2021, which is worse than the US$47.7 billion loss estimated in April. The association said net 2020 loss estimates have been revised to $137.7 billion from US$126.4 billion. Taken together, total industry losses in 2020-2022 are expected to reach US$201 billion.

Read Willie Walsh’s Speech
View the Outlook Presentation
View Industry Statistics Data Tables
View the Economic Performance of the Airline Industry Report

IATA said demand (measured in RPKs) is expected to stand at 40 percent of 2019 levels for 2021, rising to 61 percent in 2022. Total passenger numbers are expected to reach 2.3 billion in 2021. This will grow to 3.4 billion in 2022 which is similar to 2014 levels and significantly below the 4.5 billion travellers of 2019. Robust demand for air cargo is expected to continue with 2021 demand at 7.9 percent above 2019 levels, growing to 13.2 percent above 2019 levels for 2022.

IATA Director General Willie Walsh at the 2021 annual general meeting in Boston. (PHOTO: IATA)

“The magnitude of the COVID-19 crisis for airlines is enormous,” said Willie Walsh, IATA’s director general. “Over the 2020-2022 period total losses could top US$200 billion. To survive airlines have dramatically cut costs and adapted their business to whatever opportunities were available. That will see the US$137.7 billion loss of 2020 reduce to US$52 billion this year. And that will further reduce to US$12 billion in 2022. We are well past the deepest point of the crisis. While serious issues remain, the path to recovery is coming into view. Aviation is demonstrating its resilience yet again.”

The air cargo business is performing well, and domestic travel will near pre-crisis levels in 2022. The challenge is international markets which remain severely depressed as government-imposed restrictions continue, IATA said.

COVID-19 vaccines arrive at Singapore’s Changi Airport on 21 December. (PHOTO: Ministry of Communications and Information)

“People have not lost their desire to travel as we see in solid domestic market resilience. But they are being held back from international travel by restrictions, uncertainty and complexity. More governments are seeing vaccinations as a way out of this crisis. We fully agree that vaccinated people should not have their freedom of movement limited in any way. In fact, the freedom to travel is a good incentive for more people to be vaccinated. Governments must work together and do everything in their power to ensure that vaccines are available to anybody who wants them,” said Walsh.

Re-establishing global connectivity, the 11.3 million jobs (pre-COVID-19) in the aviation industry, and the US$3.5 trillion of GDP associated with travel and tourism should be priorities for governments. “Aviation is resilient and resourceful, but the scale of this crisis needs solutions that only governments can provide. Financial support was a lifeline for many airlines during the crisis. Much of that—approximately US$110 billion— is in the form of support that needs to be paid back. Combined with commercial borrowing the industry is now highly leveraged. We don’t want handouts, but wage support measures to retain critical skills may be necessary for some airlines until governments enable international travel at scale. And regulatory alleviations, like continued slot wavers while international traffic recovers,will be needed well into 2022,” said Walsh.


Despite the pandemic, there is still a lot of pent-up demand to travel.(PHOTO: Shutterstock)
  • Global demand, measured in RPKs, is recovering steadily.
  • In 2021 overall demand is expected to reach 40 percent of pre-crisis (2019) levels. Capacity is expected to increase faster than demand growth, reaching 50 percent of pre-crisis levels for 2021. The average passenger load factor in 2021 is expected to be just 67.1 percent, a level not seen since 1994.
  • In 2022 overall demand is expected to reach 61 percent of pre-crisis (2019) levels. Capacity is expected to continue to increase faster than demand, reaching 67 percent of pre-crisis levels for 2022. Average passenger load factors are expected to recover to 75.1 percent, a level exceeded in every year since 2005 until this crisis hit, and far below the 82.6 percent record set in 2019.
  • Domestic demand, with fewer restrictions in most countries, is driving the recovery. Global GDP is expected to grow by 5.8 percent in 2021 and a further 4.1 percent in 2022. Additionally, accumulated consumer savings (worth 10-20 percent of GDP in some countries) is supporting the alleviation of pent-up demand in unrestricted domestic markets.
  • In 2021 domestic demand is expected to reach 73 percent of pre-crisis (2019) levels.
  • In 2022 domestic demand is expected to reach 93 percent of pre-crisis (2019) levels.
  • International demand is the slowest to recover owing to continuing restrictions on the freedom of movement across borders, quarantine measures and traveler uncertainty.
  • In 2021 international demand is expected to reach 22 percent of pre-crisis (2019) levels.
  • In 2022 international demand is expected to reach 44 percent of pre-crisis (2019) levels.
  • Cargo demand (measured in CTK) is strong as companies continue to re-stock. The World Trade Organization forecasts world trade to grow at 9.5 percent in 2021 and 5.6 percent in 2022.
  • In 2021 cargo demand is expected to exceed pre-crisis (2019) levels by 8 percent.
  • In 2022 cargo demand is expected to exceed pre-crisis (2019) levels by 13 percent.

Revenue and Yield

Airlines like Singapore Air have had to ground thousands of planes due to the COVID-19 pandemic and near shutdown of international aviation. (PHOTO: Steve Strike/Outback Photographics)
  • Overall revenues in 2021 are expected to grow by 26.7 percent compared to 2020 to US$472 billion (similar to 2009 levels). Further growth of 39.3 percent in 2022 will see industry revenues rise to US$658 billion (similar to 2011 levels).
  • The passenger business will contribute US$227 billion to industry revenues in 2021, rising to US$378 billion in 2022. Passenger yields declined each year between 2012 and 2020. In 2021 yields are expected to grow by 2.0 percent and a further 10 percent in 2022.
  • Cargo revenues are expected to rise to a record US$175 billion in 2021 with a similar US$169 billion expected in 2022. Cargo yields are expected to grow by 15 percent in 2021 but decline by 8 percent in 2022.


Because Singapore Airlines has no domestic network, its Changi Airport base is still almost a ghost town in 2021. A lone student waits to say goodbye to a friend in a nearly deserted departure hall. (PHOTO: Matt Driskill)
  • Airlines achieved aggressive cost reductions having reduced overall expenses by 34 percent in 2021 compared to 2019. Costs, however, will rise in 2022 and will be only 15 percent lower compared with pre-crisis levels with expanded operations and higher fuel prices.
  • The price of jet kerosene was the only respite for airlines in 2020. It fell to US$46.6/barrel in 2020 from US$77/barrel in 2019. Kerosene prices increased to an average of US$74.5/barrel in 2021 and are expected to rise further to US$77.8/barrel in 2022.
  • Non-fuel unit costs rose 19 percent in 2020 compared to 2019, as fixed costs had to be spread over a dramatically smaller capacity base. This will partially reverse in 2021 with an 8 percent reduction from 2020 levels. Capacity growth will spread fixed costs more broadly while cost cutting efforts continue. In 2022, we expect a 2 percent increase.


Airlines like Etihad and Australia’s Qantas are requiring staff to be vaccinated. (PHOTO: Etihad)
  • Vaccinations are proving to be a key driver for government relaxation of border control measures. Quick progress, with some exceptions, of vaccine distribution in developed economies is progressively giving governments the confidence to re-open borders and people the confidence to travel. Parts of the world with slower vaccine distribution (developing economies and some developed economies in Asia Pacific) will take longer to see an industry recovery.

Regional Performance

Region Demand (RPK) vs 2019 Capacity (ASK) vs 2019 Net Profits
($ billions)
Operating Margin
(% of revenues)
2021 2022 2021 2022 2021 2022 2021 2022
World -59.7% -39.2% -50.4% -33.1% -$51.8 -$11.6 -11.4% -2.7%
North America -40.0% -18.8% -31.2% -15.0% -$5.5 $9.9 -5.2% 4.8%
Europe -64.3% -40.8% -54.6% -33.6% -$20.9 -$9.2 -17.4% -5.9%
Asia-Pacific -65.8% -47.3% -56.9% -40.1% -$11.2 -$2.4 -14.1% -9.1%
Middle East -74.5% -54.7% -58.7% -44.4% -$6.8 -$4.6 -18.2% -9.6%
Latin America -51.8% -29.3% -46.9% -27.9% -$5.6 -$3.7 -18.2% -9.7%
Africa -66.6% -57.7% -57.2% -54.6% -$1.9 -$1.5 -12.7% -9.9%

All regions will improve their collective financial performance compared to 2020. The strongest performing region is North America which is expected to see a US$5.5 billion loss in 2021 transform to a US$9.9 billion profit in 2022. All other regions will see reduced losses in 2022 compared to 2021.

  • North American carriers are expected to outperform other regions on the back of fast recovery of the US domestic market. The opening of the US market to vaccinated travellers from November 2021 will progress the recovery to international markets. The US industry started to turn cash-positive in the second quarter of 2021 and will be the only region in positive financial territory in 2022 with an expected US$9.9 billion profit.
  • European carriers will see their losses cut from US$20.9 billion in 2021 to US$9.2 billion in 2022. Shifting rules and confused application of EC recommendations across Europe compromised the expected positive impact of rising vaccination rates and establishment of the European Digital Covid Certificate. Better coordination between governments is expected to see a broader opening of international markets in the months ahead, boosted significantly by the re-establishment of transatlantic travel for vaccinated travellers. Long-haul demand, however, will significantly lag the recovery in intra-European travel.
  • Asia-Pacific carriers are expected to see losses diminish from US$11.2 billion in 2021 to US$2.4 billion in 2022. The region continues to suffer some of the most draconian travel restrictions. While there has been some alleviation in restrictions, significant improvements in international markets are not expected until later in 2022. Reduced losses are expected to be achieved on the back of large and largely open domestic markets, not least of which is China. The region’s carriers are also benefitting disproportionally from the strength of air cargo markets in which they are dominant.
  • Latin American carriers will see losses cut from US$5.6 billion this year to US$3.7 billion in 2022. Most of the region’s markets are open, but with some notable exceptions (Argentina for example). The strength of the US-Latin American market will be a major contributing factor to improvement. Significant restructuring costs as the regions carriers adjust to the new business realities will weigh on financial performance, keeping the region in a collective loss.
  • Middle Eastern carriers will see very limited improvement in their financial performance from a US$6.8 billion loss in 2021 to a US$4.6 billion loss in 2022. Without large domestic markets, the region’s major carriers rely significantly on connecting traffic, especially to Asia-Pacific which has been slow to re-open to international traffic.
  • African carriers will see a very slow pace of recovery in financial performance from a US$1.9 billion loss in 2021 to a US$1.5 billion loss in 2022. Low vaccination rates across the continent are expected to severely dampen demand throughout 2022. The slight improvement is built on the expectation of some recovery in intra-Africa travel and travel to some tourist destination with relatively higher vaccination rates.

Use this one

For Editorial Inquiries Contact:
Editor Matt Driskill at matt.driskill@asianaviation.com
For Advertising Inquiries Contact:
Head of Sales Kay Rolland at kay.rolland@asianaviation.com


Please enter your comment!
Please enter your name here