Airlines, suffocated, hold their general assembly

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The International Air Transport Association (Iata) is holding its 76e General Assembly, in the shadow of a pandemic that has plunged the sector into a historic crisis since March, with no clearing in the short term.

An unprecedented shock The Covid-19 and the traffic restrictions put in place to prevent the spread of the new coronavirus grounded almost the entire world fleet in the spring.

Air traffic hit a low point in April before slowly picking up in June and then slowing down again in September with the resurgence of the virus.

For all of 2020, Iata estimates the drop in traffic at 66%.

The organization considers that global air traffic will not return to its 2019 level before 2024 – an estimate based on the arrival of a vaccine in the summer of 2021.

It estimates the sector’s turnover for 2020 at 419 billion dollars, down by half compared to 2019.

Heavy consequences for employment Tens of thousands of jobs have already been cut by companies and according to a survey carried out by Iata in October, 59% of the companies questioned are considering further cuts in the next twelve months.

Airlines for America, the federation representing American airlines, estimated that companies in the sector would cut a total of 90,000 jobs between March and December.

“To reach the level of productivity of recent years, the number of jobs would have to be reduced by 40%”, estimates Iata.

Most governments mobilized in the spring to come to the aid of the sector, but faced with the second wave of the epidemic which is once again draining their cash flow, companies are demanding other aid.

According to Iata, the sector has already obtained 160 billion dollars in aid in various forms.

They have so far helped reduce breakage.

But two large Latin American companies, the Brazilian-Brazilian LATAM and the Colombian Avianca, filed in May under the protection of American bankruptcy law. Smaller companies, such as the South African South African Airways and Comair, the British Flybe or the Austrian and French branches of Level (IAG) were swept away.

In bankruptcy, the Australian giant Virgin Australia was bought by an American company.

In November, the South Korean company Korean Air reached an agreement to buy out its struggling compatriot Asiana Airlines.

Freight, carried by medical deliveries While passenger transport was brought to a halt by the epidemic, that of goods remained dynamic, in particular with the delivery of masks and medical equipment at the start of the crisis and perhaps soon the mass distribution of vaccines.

For several years, a large part of air cargo has shifted from full-cargo aircraft to the holds of commercial aircraft.

According to Iata, this activity usually represents 15% of companies’ revenues. Since the crisis, due to the drop in the number of planes and therefore in the volumes available in the holds, prices have increased and freight now represents between 20 and 25% of turnover.

And the environment Despite their fragility, companies, already under pressure from environmental NGOs before the crisis, will have to keep their commitments to reduce their CO2 emissions by half in 2050 compared to 2005.

Initially, they are focusing in particular on the use of biofuels, up to 2% of the total volumes of fuel consumed by 2025.

Companies will also have to adapt to new societal trends resulting from confinement and in particular the use of remote conferencing facilities which could encroach on the highly profitable business travel segment for a long time.

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