JANUARY AIR TRAFFIC DOWN 70%

By The Financial District
Feb 4, 2021
2 min read

Bookings for future travel made in January 2021 were down 70% compared to a year-ago, putting further pressure on airline cash positions and potentially impacting the timing of the expected recovery, according to data from the International Air Transport Association (IATA).

The year-on-year decrease in the month of December amounted to 85 per cent for international routes and 70 percent for domestic flights. The industry group measures traffic as the total amount of kilometers flown by passengers.

"Our forecast is for traffic to return to half of 2019 levels in 2021,” IATA chairperson Alexandre de Juniac told a press conference. "But the proliferation of restrictions on travel that we have seen since the beginning of the year could make even that modest outlook very challenging," he added.

“Last year was a catastrophe. There is no other way to describe it. What recovery there was over the Northern hemisphere summer season stalled in autumn and the situation turned dramatically worse over the year-end holiday season, as more severe travel restrictions were imposed in the face of new outbreaks and new strains of COVID-19.”

International passenger demand in 2020 was 75.6% below 2019 levels. Capacity, (measured in available seat kilometers or ASKs) declined 68.1% and load factor fell 19.2 percentage points to 62.8%.

Domestic demand in 2020 was down 48.8% compared to 2019.

Capacity contracted by 35.7% and load factor dropped 17 percentage points to 66.6%. December 2020 total traffic was 69.7% below the same month in 2019, little improved from the 70.4% contraction in November.

Capacity was down 56.7% and load factor fell 24.6 percentage points to 57.5%, 50.6% of 2019 levels. While this view remains unchanged, there is a severe downside risk if more severe travel restrictions in response to new variants persist.

Should such a scenario materialize, demand improvement could be limited to just 13% over 2020 levels, leaving the industry at 38% of 2019 levels.

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