IATA: Brazil’s Airlines Could Lose US$13.6 Billion in Revenue Because of Covid-19
RIO DE JANEIRO, BRAZIL – The International Air Transport Association (IATA) has raised to US$13.61 billion the projected revenue loss for air carriers in Brazil in 2020 because of Covid-19.
In July, the association had projected that Brazilian airlines would lose US$10.83 billion in revenues this year as a result of the pandemic. The data were released by the association on Thursday, December 10th, in a teleconference with journalists.
In total revenue, the association expects that the country’s airlines will close 2020 with a drop of 71% compared to 2019 – in the July report, the projection was to close with a 57% drop.
The Covid-19 crisis has dramatically affected the economy and the whole airline chain. The estimate is that 393,000 jobs will be lost this year in the country taking into account the whole economy. In the airline sector alone, the estimate is for a loss of 108,500 jobs, the association noted. The crisis could pull US$8.9 billion from Brazilian GDP this year, considering airlines and tourism.
During the event, IATA’s vice-president for the Americas, Peter Cerdá, stressed that the Brazilian market has been recovering rather satisfactorily. “We have good market capacity, good connectivity with the world. The number of international passengers is lower because of the restrictions to foreign tourism in Europe and the United States,” he said.
He also recalled the return of the Boeing 737 Max to the skies in Brazil, operated by Gol, which would be good news for the sector.
Cerdá stressed that countries can benefit from and encourage domestic tourism while the borders of more traditional destinations remain closed. “This is a unique opportunity to encourage local tourism,” he said.
In the United States, the continent’s main market, the estimate is for a 69% drop in revenue compared to 2019. In Mexico, the estimated drop in revenue in the year is 65%. In Argentina, the estimated reduction reaches 70%.
Overall, Cerdá advocated opening markets to air traffic and encouraged the use of Covid-19 tests as a means of preventing the spread of the virus during travel.
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