IATA has warned more airlines will collapse over the coming months. Even by the end of this year, passenger traffic will still be down by about 68%, much worse than its previous forecast.
Airlines are burning through $13 billion per month which will lead to more bankruptcies, said IATA Director General Alexandre de Juniac.
“The crisis is growing longer and deeper than anyone could have imagined, and the initial support programs are running out. If these support programs are not replaced or extended, the consequences for an already hobbled industry will be dire,” he said during a media briefing.
IATA is urging governments to provide urgent financial aid.
“The impact has spread across the entire travel value chain including our airport and air navigation infrastructure partners who are dependent on pre-crisis levels of traffic to sustain their operations.”
The total cash burn for the second half of the year is estimated at $77 billion.
Airlines managed to cut costs by an average 50% during the second quarter but overall revenues fell almost 80% compared to 2019.