The airline industry has taken a tremendous hit this year, with countries worldwide shutting down borders and limiting travel in response to the Covid-19 outbreak. Flight cancellations to control the spread of the virus led to huge drops in airline passenger revenues and caused staggering losses to the world's largest airline companies. Airfreight capacity dropped immediately leaving the industry in turmoil.It has been reported that the world’s largest airlines have lost $110 billion in year-to-date revenue. This includes the likes of American Airlines, Lufthansa, Air France, Delta Airlines and the International Airlines Group. Between January and March, Delta Air Lines, the world's largest airline based on sales, lost $1.8 billion. The company's earnings report showed the second quarter of the year delivered losses that were six times more severe, with revenue plunging by 88% year-on-year to $1.4 billion. The strong negative trend continued between June and September, with the company losing another $9.5bn after the coronavirus pandemic ruined what is typically a peak summer travel period. According to Glyn Hughes, global head of cargo for the International Air Transport Association (Iata), the aviation industry will see a reduction in revenue this year of over $400 billion. “The drop in passenger volumes due to Covid-19 was phenomenal and something we have never seen before. Cargo volumes also plummeted but not near as much as that of passengers – particularly because of the role air cargo played in moving personal protective equipment (PPE) and other key items during the height of the pandemic.” The decline in air cargo, he said, was very similar to that experienced during the downturn in 2007 and 2008 which was negligible considering the losses being faced in the aviation sector this year.According to Hughes, expectations are that the demand for air cargo will remain much more robust than air travel going forward.Commenting on the recovery in various markets, he said it remained varied across major trade lanes. While some lanes had seen massive losses others had seen positive growth in the past few months.“Capacity has been one of the key issues that we have had to tackle as an industry during the pandemic. Freighter utilisation is running at an all-time high, while passenger aircraft have remained grounded.” Hughes said the outlook was positive, with export orders rebounding sharply. “This points to a strong recovery in air cargo volumes over the next few months. There is, however, one major challenge that the air cargo sector will have to prepare for and that is vaccinating the world against Covid-19.” He said Iata was continuing to lobby stakeholders to start planning for vaccination distribution now.According to Luis Roman, global vice president of the Janssen pharmaceutical companies of Johnson & Johnson, lessons have been learnt by the air cargo sector during Covid-19 that will assist with vaccine distribution.
