- October 8, 2020
- Posted by: Stratford Team
- Category: Business
Dozens of airlines have already gone under this year as the coronavirus pandemic brought global air travel to a near-standstill, a new report says.
Some 43 commercial carriers have suspended or ended their operations since January, compared with 46 in all of last year and 56 failures in 2018, CNBC reported Thursday, citing figures from travel data firm Cirium.
Even more airlines are reportedly likely to bite the dust in the final few months of the year, when carriers rely on revenue they accumulated during the spring and summer months. There was little money to be made during those traditionally busy periods this year as COVID-19 forced officials to impose lockdowns and travel restrictions around the world.
“With demand recovery in most regions stalled and airlines still struggling with revenue generation and cash outflow, we expect to see more failures in the final quarter of 2020 and first quarter of 2021 at least,” Rob Morris, Cirium’s global head of consultancy, told CNBC.
Airlines have also grounded a larger number of planes this year, a sign that the crisis is affecting larger carriers as well as small ones, according to the network.
A total of 485 aircraft have been parked so far this year as a result of companies failing, up from 431 last year and 406 in 2018, CNBC reports. And 20 of the carriers that have folded so far this year operated 10 or more planes, compared with just 12 in 2019, Cirium’s data reportedly show.
The figures are the latest sign that airlines are struggling to recover from the COVID-19 pandemic. The International Air Transport Association expects the industry to burn through $77 billion in cash — or $300,000 a minute — in the second half of this year as airlines trudge back from the depths of the crisis.
And major US carriers United and American started furloughing more than 32,000 workers last week after federal aid to keep them on the payroll expired. Airlines and labor groups have pleaded the feds for another bailout, but it’s uncertain when Congress might approve one.