Updated: March 20, 2020 10:41:29 am
The International Air Travel Association (IATA) has estimated that the financial impact of the coronavirus (Covid-19) on the passenger business of airlines would be somewhere between $63 billion and $113 billion.
Earlier, when the virus was still confined to China, IATA’s revenue impact estimate was significantly lower, at $29.3 billion.
Industry players fear that the impact of this Black Swan event on the industry will be similar to that of the global financial crisis of 2008. “Airline share prices have fallen nearly 25 per cent since the outbreak began, some 21 percentage points greater than the decline that occurred at a similar point during the SARS (Severe Acute Respiratory Syndrome) crisis of 2003,” IATA said on Thursday.
Assuming a decrease in passenger numbers in all the markets, which have at least 10 confirmed Covid-19 positive cases as of March 2, the IATA estimated a 19 per cent loss in worldwide passenger revenues, aggregating to around $113 billion.—FE
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