Middle East airlines’ losses for 2021 to reduce by half from 2020

Middle East airlines’ losses for 2021 to reduce by half from 2020

Middle East carriers net losses will reduce to -13.8 per cent of revenues in 2021, up from -28.9 per cent in 2020, the International Air Transport Association (IATA) says in its latest forecast.

IATA says regional carriers will benefit from relatively rapid vaccination rates on home markets. They will be hampered, however, by continued travel restrictions on many of the routes to emerging economies that are served through Gulf hub connections, the report added.

Globally, IATA expects net airline industry losses of $47.7bn in 2021 (net profit margin of -10.4 per cent). This is an improvement on the estimated net industry loss of $126.4bn in 2020 (net profit margin of -33.9 per cent).

Worldwide industry revenues are expected to total $458bn. That's just 55 per cent of the $838bn generated in 2019 but represents 23 per cent growth on the $372bn generated in 2020.

Travel restrictions, including quarantines, have killed demand. IATA estimates that travel (measured in revenue passenger kilometres or RPKs) will recover to 43 per cent of 2019 levels over the year. While that is a 26 per cent improvement on 2020, it is far from a recovery. Domestic markets will improve faster than international travel. Overall passenger numbers