Canceling airline tickets with 35 billion dollars

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Follow-up: Anwar Dawood

A new analysis by the International Air Transport Association (IATA) predicts that global airlines may drain about $ 61 billion of their cash reserves during the second quarter ending June 30, 2020, with a net quarterly loss of $ 39 billion.
This analysis is based on the evaluation of the impact issued by the International Air Transport Association, which was issued last week, in light of a scenario indicating the continued tightening of travel restrictions over a period of three months. In this scenario, demand for the whole year decreases by 38% and passenger revenue for the entire year is reduced by $ 252 billion compared to 2019.
Airlines are facing the recovery of unused tickets sold as a result of massive cancellations resulting from government travel restrictions. Where it represents obligations of about 35 billion dollars.
For its part, OAG said that international airlines removed about 30% of the seat capacity for flights within only one week, in light of the decline in demand for travel and the restrictions imposed by governments on domestic and international travel.
The company’s data indicated that during the past seven days, airlines have removed about 20 million seats on scheduled flights around the world, which represent the largest reduction in seat capacity recorded by «OAG».
She explained that the size of the global aviation sector is now half of what it was in mid-January, especially with the application of airlines in the United States and India to what it announced a reduction in flights.
“American Airlines” announced that it will apply for $ 12 billion in aid, as part of the government proposal, as part of a plan to support the aviation sector, which is suffering from the repercussions of the outbreak of the new Corona virus. The US Congress allocated $ 50 billion to the sector in its $ 2 trillion bailout plan for the economy.

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