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The International Air Transport Association (IATA) has released its latest business confidence survey of airline CFOs and heads of cargo.
Key points from the survey:
- Our July 2020 survey of airline CFOs and Heads of Cargo confirmed that the aviation industry experienced the sharpest quarterly fall in demand and profits since the global financial crisis. Moreover, weakness in profitability is expected to be maintained over the next 12 months.
- In Q2 2020, passenger demand collapsed while cargo demand improved slightly, following a sharp decline in the previous quarter.
- Passenger and cargo yield developments continued to diverge in Q2. Passenger yields fell due to the lack of demand, while cargo yields continued to increase, reflecting the lack of cargo capacity from the grounding of much of the passenger fleet.
- For the year ahead, the majority of respondents expect airfares to decrease in order to stimulate demand. Similarly, cargo yields are generally expected to unwind with the return of bellyhold cargo capacity.
- With the recovery in demand likely to be slow, 55 per cent of respondents expect to have to decrease employment levels over the coming 12 months.
- Expectations for input costs are mixed. While low fuel prices and cost cutting programs were supportive, unit costs face upwards pressure from weak demand and accordingly low load factor levels.
View the full report here.
