Iata Annual Review 2020

Annual Review 2020
Alexandre de Juniac
Director General & CEO
International Air Transport Association
Annual Review 2020

76th Annual General Meeting,
Amsterdam, November 2020
Note: Unless otherwise specified,

all dollar ($) figures refer to US dollars (US$).
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Contents
02 Members’ list
04 Director General’s foreword
06 Chair’s remarks and Board members
10 The industry story in 2020

20 Health and safety in 2020
24 Relief measures in 2020
04
01
28 Connectivity in 2020
34 Before the storm: 2019 in review

40 Safety
41 Security
42 Regulations & taxation
44 Infrastructure
46 Environment
48 Cargo
50 Passenger experience
52 Financial services
04 IATA Annual Review 2020

01
Members’ list
Members’ list
A
Aegean Airlines Air Transat British Airways Etihad Airways
Aer Lingus Air Vanuatu Brussels Airlines EuroAtlantic Airways
Aero Republica AirBridgeCargo Airlines Bulgaria Air European Air Transport
Aeroflot Aircalin C Eurowings
Aerolineas Argentinas Airlink Cabo Verde Airlines EVA Air
Aeromar Alaska Airlines CAL Cargo Airlines Evelop Airlines
Aeromexico Albastar Camair-Co F
Africa World Airlines Alitalia Cambodia Angkor Air FedEx Express
Air Algerie Allied Air Capital Airlines Fiji Airways
Air Arabia AlMasria Universal Airlines Cargojet Airways Finnair
Air Astana American Airlines Cargolux flydubai
Air Austral ANA Caribbean Airlines FlyEgypt
Air Baltic APG Airlines Carpatair Flynas
Air Botswana Arik Air Cathay Dragon Freebird Airlines
Air Burkina Arkia Israeli Airlines Cathay Pacific French Bee
Air Cairo Asiana Airlines Cebu Pacific Fuzhou Airlines
Air Caledonie ASKY China Airlines G
02 Air Canada ASL Airlines France China Cargo Airlines Garuda Indonesia
Air Caraibes Atlantic Airways China Eastern Georgian Airways
Air China Atlas Air China Express Airlines GOL Linhas Aereas
Air Corsica Austral China Postal Airlines Gulf Air
Air Dolomiti Austrian China Southern Airlines GX Airlines
Air Europa Avianca CityJet
H
Air France Avianca Costa Rica Condor Hahn Air
Air Guilin Avianca Ecuador Congo Airways Hainan Airlines
Air India Avianca Peru Copa Airlines Hawaiian Airlines
Air Koryo Azerbaijan Airlines Corendon Airlines Hebei Airlines
Air Macau Azores Airlines Corsair International Hi Fly
Air Madagascar Azul Brazilian Airlines Croatia Airlines Hong Kong Air Cargo
Air Malta B Cubana Hong Kong Airlines
Air Mauritius Bahamasair Cyprus Airways Hong Kong Express
Air Moldova Bamboo Airways Czech Airlines Airways
Air Namibia Bangkok Airways D I
Air New Zealand Batik Air Delta Air Lines Iberia
Air Niugini Belavia Belarusian Airlines DHL Air Icelandair
Air Nostrum Biman Bangladesh Airlines DHL Aviation IndiGo
Air Peace Binter Canarias
E Interjet
Air Serbia Blue Air Eastern Airways Iran Air
Air Seychelles Blue Panorama Egyptair Iran Airtour Airline
Air Tahiti BoA Boliviana de Aviacion EL AL Iran Aseman Airlines
Air Tahiti Nui Braathens Regional Emirates Israir
Air Tanzania Airways
Ethiopian Airlines

Members’ list
J
Japan Airlines Mauritania Airlines Royal Brunei Thai Smile
Japan Transocean Air International Royal Jordanian Tianjin Airlines
Jazeera Airways MEA Ruili Airlines TUIfly
Jeju Air MIAT Mongolian Airlines RusLine Tunisair
JetBlue MNG Airlines RwandAir Turkish Airlines
Jin Air Montenegro Airlines T’way Air
S
Jordan Aviation Myanmar Airways
International S7 Airlines U
Juneyao Airlines Safair Ukraine International
N Airlines
K NCA Nippon Cargo
SAS
Kenya Airways SATA Air Acores UNI AIR
Airlines
KLM Saudi Arabian Airlines United Airlines
Neos
Korean Air SaudiGulf Airlines UPS Airlines
Nesma Airlines
Kunming Airlines SCAT Airlines Ural Airlines
Nile Air
Kuwait Airways SF Airlines Urumqi Air
NordStar
Shandong Airlines UTair
L Nordwind Airlines
Shanghai Airlines Uzbekistan Airways
LAM Nouvelair
Lao Airlines Shenzhen Airlines V
O 03
LATAM Airlines Argentina Sichuan Airlines Vietjet
Okay Airways
LATAM Airlines Brasil Silk Way West Airlines Vietnam Airlines
Olympic Air
LATAM Airlines Colombia SilkAir Virgin Atlantic
Oman Air
LATAM Airlines Ecuador Singapore Airlines Virgin Australia
Onur Air
LATAM Airlines Group SKY Airline Vistara
Overland Airways
LATAM Airlines Paraguay Smartavia Volaris
P Volotea
LATAM Airlines Peru Solomon Airlines
Paranair
LATAM Cargo Brasil Somon Air Vueling
Pegas Fly
LATAM Cargo Chile
Pegasus Airlines
South African Airways W
LIAT Airlines SpiceJet Wamos Air
PGA Portugalia Airlines
Loong Air SriLankan Airlines West Air
Philippine Airlines
LOT Polish Airlines SunExpress WestJet
PIA Pakistan International
Lucky Air Airlines Suparna Airlines White Airways
Lufthansa Polar Air Cargo Surinam Airways Wideroe
Lufthansa Cargo Poste Air Cargo SWISS Wings of Lebanon
Lufthansa CityLine Precision Air Syrianair X
Luxair Privilege Style T Xiamen Airlines
M Q TAAG Angola Airlines Y

Mahan Air Qantas TACA YTO Cargo Airlines
Malaysia Airlines Qatar Airways TAP Portugal
Malindo Air Qazaq Air TAROM As at November 2020
Mandarin Airlines Tassili Airlines

R
Martinair Cargo Thai Airways International
Rossiya Airlines
Mas Air Thai Lion Air
Royal Air Maroc

Crises are not new —
Director General’s foreword

resilience is in our DNA
Alexandre de Juniac,
Director General and CEO
The aviation industry is in crisis. of people say that they continue to eliminate all but the most essential
Our business connects people. feel safe traveling by air. demand.
But owing to efforts to control the
spread of the novel coronavirus Less outwardly visible, but just The solution is the systematic
(COVID-19), we have seen the as important, is our work with predeparture testing of travelers.
greatest de-connecting of the regulators to safely ramp-up Affordable, fast, accurate, easy-to-
world since the Second World War. operations when it becomes use, and scalable tests exist. And
Borders are effectively closed. possible. Reactivating thousands IATA is among several providers
Lockdowns have been imposed. of grounded aircraft, managing with solutions that governments
Freedom of movement has been the qualifications and readiness can trust will provide reliable results
severely limited. The impact on avi- of millions of licensed personnel, from tests conducted in other
ation has been catastrophic. At the and dealing with a major drain of jurisdictions. IATA continues to work
peak of the crisis in April 2020, 90% experienced workers will be key to with partners across the industry to
of our business disappeared. safe flying. From the earliest stages give governments the confidence
of the crisis, we have worked with that testing is the way to restore
Crises, though, are not new to ICAO and regulators on a frame- connectivity during the pandemic.
aviation. We have proven our resil- work to do this.
ience many times. Today, resilience Longer term, the solution is vac-
cines. IATA is collaborating with the
04 depends on
global COVAX initiative to develop
Sustainability
• maintaining our fundamental comprehensive guidance materials
commitments to safety and Aviation’s commitment to environ- for the transport of vaccines. The
sustainability, mental sustainability has only been airline industry, therefore, will be
strengthened in the face of the ready for its greatest-ever logis-
• reopening borders, and tical challenge. But policy makers
pandemic. As a result of the historic
Carbon Offsetting and Reduction must not be distracted from the
• repairing shattered finances.
Scheme for International Aviation urgent need to reopen borders by
(CORSIA), aviation’s carbon emis- the promise of eventual vaccines.
sions from international operations Every day that borders remain
Safety will not grow beyond 2019 levels. closed does irreparable damage
Even amid the crisis, IATA worked to economies and to peoples’ lives
Safety is always aviation’s top pri-
with our industry partners to map and livelihoods.
ority. This commitment is unaltered
by the crisis. But it has not been the way to our 2050 goal of cutting
unchallenged. Travelers are rightly the industry’s net emissions to
half of 2005 levels. And we have Shattered finances
concerned about the risks of air
travel. Yet the news is reassuring. growing confidence that we can
get to net zero as early as 2060. In the meantime, the industry is
The data and scientific research grateful to governments for the
confirm that the risk of catching Both targets will need the support
of governments, particularly in the $173 billion of support provided
COVID-19 onboard an aircraft is to airlines. It avoided mass bank-
low compared with other indoor area of sustainable aviation fuels
(SAF). ruptcies and job losses. Ensuring
environments. Measures such as the industry’s financial viability is a
wearing masks and cleaning and smart investment. Each aviation job
sanitizing the onboard environ- supports 24 more.
ment more frequently reduce that Open borders
risk further. These are just a few of Many government support pro-
the multiple layers of protections The biggest barrier to restarting grams, however, were not designed
recommended in the Take-off aviation is the closure of bor- for a crisis of this duration. Airlines
guidance materials published by ders caused by travel restric- are expected to lose $118 billion
the International Civil Aviation tions or quarantine measures. in 2020 and a further $38 billion in
Organization (ICAO) in cooperation Governments, understandably, do 2021. So more government sup-
with public health authorities and not want to import COVID-19 via port—in forms that do not further
industry representatives, including air travel. But the risk must and can inflate airline debt levels—is needed
IATA. And surveys tell us that 86% be managed without measures that to help airlines survive. Without

Director General’s foreword
05
viable airlines, the economic recov- once again the value of aviation Our slimmer form notwithstanding,
ery from COVID-19 will be longer connectivity. When the world cried members can continue to rely on
and more painful. out, aviation responded, with at IATA to be a strong voice for the
least 46,000 special cargo flights industry, to provide the vital prod-
delivering 1.5 million metric tons ucts and services that you depend
The business of freedom of medical equipment to fight the on, and to set the global standards
virus. Aviation likewise flew nearly for efficient operations.
The apex of the COVID-19 crisis 40,000 repatriation flights to bring
coincided with IATA’s 75th anni- some 5.4 million people home to The months ahead will challenge all
versary. IATA was founded by 57 their families and loved ones. of us as never before. But resil-
visionary airline leaders in April ience is in aviation’s DNA. We will
1945. Today, we boast 290 mem- IATA, too, has felt the impact of reconnect the world. Our mission is
bers comprising 82% of global air the crisis. We have restructured in unchanged. We are the business of
traffic. In place of celebrating IATA’s line with the smaller industry that freedom. The pages that follow tell
milestone, airlines were proving is likely to emerge from COVID-19. our story.

Meeting the COVID-19
Chair’s remarks
challenge together
Carsten Spohr, Chair, IATA Board of Governors,
Chairman and CEO Lufthansa Group
What is IATA’s role helping the and will resume its role as a global
industry through the COVID-19 “force for good.” However, this
pandemic? crisis is at the same time a unique
chance to further reduce our
IATA has proven to be an essential climate impact and to strive for
and irreplaceable crisis manager for sustainable and value-oriented
the global aviation industry in this growth. We have the responsibility
pandemic. We act as consultants to take this chance and to make our
for both our industry and govern- industry emerging from this crisis
ments worldwide. And we advocate more climate friendly.
for relief measures like the slot
waiver, generate support measures
from suppliers, and vote for tests
instead of quarantines. IATA is also How should IATA prepare itself to
offering a valuable communication bring value to its members in the
platform for airline managers, as post-COVID-19 world?
well as governments and public
Our mission remains unchanged
authorities. Not to forget, IATA plays
in the future: IATA represents,
06 an important role in ICAO’s Council
leads, and serves the global airline
Aviation Recovery Task Force.
industry. We will continue on this
Together, we safeguard airline’s
path and positively bring
interests in cooperation with civil
forward issues like
aviation authorities.
industry safety,
financial settle-
ment systems,
What sort of airline industry and operational
do you think will emerge once standards.
demand recovers?
Frankly speaking, no one can pre-

dict how long the pandemic will last
and how long our industry will suffer
from its consequences. A reliable
outlook is more difficult than ever
before. It depends on the accep-
tance for free mobility of COVID-19
negative tested travelers as well as
on the development and the avail-
ability of an effective vaccine. This
will determine how governments go
on with travel warnings, entry bans,
and lockdowns.
But one thing is for sure: A global

society and a modern world
economy cannot exist without air
transport. Flying has an enormous
value for societies, cultures, educa-
tion, economies and international
understanding.
This is why I’m deeply convinced

that the airline industry will recover

IATA Board
Chair’s remarks
of Governors
2019–2020*
But the crisis in which we are in also CHAIR OF THE BOARD Yuji Hirako Anco van der Werff
shows very clearly that we need to President and Chief Chief Executive Officer
Carsten Spohr Executive Officer Avianca
take a common and firm political Chairman and Chief All Nippon Airways
stand. We need to unite our voices Executive Officer Wang Changshun
Lufthansa
and make our positions better Alan Joyce Chairman
heard. This applies to overcoming MEMBERS Chief Executive Officer China Southern Airlines
Qantas
the current crisis, where we have Akbar Al Baker Mohamed Roshdy
been successful on the issue of Chief Executive Officer Allan Kilavuka Zakaria
slot waivers. It will certainly become Qatar Airways Ag. Group Managing Chairman and Chief
particularly important when we Director & Chief Executive Executive Officer
Roberto Alvo Officer Egyptair Holding Co
think about the impact of the sus- Chief Executive Officer Kenya Airways (representing Egyptair)
tainability debate. The pandemic LATAM Airlines Group
remains a major challenge for the Liu Shaoyong ALSO SERVED
entire industry that we can only Walter Cho Chairman
Chairman and Chief China Eastern Airlines (To July 2019)
meet together. IATA will play its role Christine Ourmières-
Executive Officer
in unifying and guiding the global Korean Air Rafal Milczarski Widener
industry through this challenge. Chief Executive Officer Chief Executive Officer
Donald Colleran and President of the Flybe Limited
President and Chief
Executive Officer
Management Board
LOT Polish Airlines (To August 2019) 07
FedEx Express Rupert Hogg
Aside from the pandemic, what Oscar Munoz Chief Executive Officer
other issues must the industry Ronojoy Dutta Chairman Cathay Pacific
keep top of the agenda? Chief Executive Officer United Airlines
IndiGo Airlines (To October 2019)
Mehmet Tevfik Nane Saleh N. Al Jasser
I see three priorities for our Director General
Mohamad El-Hout Chief Executive Officer
industry. Chairman and Director Pegasus Airlines Saudi Arabian Airlines
General
First of all, of course, safety. That Middle East Airlines Douglas Parker (To January 2020)
Sebastian Mikosz
has always been the basis for Chairman and Chief
Luis Gallego Martín Executive Officer Group Managing Director
aviation—and it will remain so in the and CEO
Chief Executive Officer American Airlines
future. IAG (representing Iberia) Kenya Airways
Calin Rovinescu
Secondly, sustainability. Our planes Tewolde GebreMariam President and Chief (To March 2020)
emit carbon. Therefore, we have Chief Executive Officer Executive Officer Somaskaran Thiagarajan
Ethiopian Airlines Appavou
an obligation to continue to work Air Canada
Chief Executive Officer
for climate-friendly air traffic. And Goh Choon Phong Air Mauritius
Vitaly Saveliev
we need worldwide-harmonized Chief Executive Officer Director General and Chief
measures, e.g. CORSIA, to meet Singapore Airlines Executive Officer Ahmed Adel
Chairman and Chief
the environmental challenges. The Aeroflot
Rickard Gustafson Executive Officer
meaning of sustainable aviation Egyptair Holding Co
President and Chief Ajay Singh
fuels and new technologies for Executive Officer Chairman and Managing (representing Egyptair)
further CO2 cannot be emphasized SAS Director
Yuji Akasaka
enough. SpiceJet Limited
Robin Hayes President
President and Chief Benjamin Smith Japan Airlines
Thirdly, we need to work on a world-
Executive Officer Chief Executive Officer
wide level playing field for airlines. JetBlue Airways Air France KLM Enrique Cueto
This concerns rules of competition, (representing Air France) Chief Executive Officer
traffic rights, taxes, and passen- Pedro Heilbron LATAM Airlines
ger and consumer rights. A global Chief Executive Officer Tang Kin Wing Augustus
Copa Airlines Chief Executive Officer (To October 2020)
industry in a globalized world needs Sami Ali Sindi
Cathay Pacific Airways
global rules and regulations. María José Hidalgo Limited Acting Director General
Gutiérrez Saudi Arabian Airlines
Chief Executive Officer
Air Europa *As at November 2020

Aviation is in
crisis.
This is the
most profound
08
de-connecting
of modern
society since
World War II.
09

Summary
The industry
chapter
story title
in 2020

10
The great connectivity
The industry story in 2020

shutdown
COVID-19 is the largest shock to commercial air travel Worldwide revenue passenger kilometers (RPKs)
and aviation since world war II flown annually
Source: IATA Economics, using data from IATA and ICAO
In 2020, the COVID-19 pandemic delivered the largest
shock to air travel and the aviation industry since the
Second World War. Previously, the adverse impacts on
aviation of the 9-11 terrorist attacks and the 2007–08
global financial crisis were thought dramatic. But neither
had an impact that compares with what is estimated to
be a 66% decline in global revenue passenger kilometers
(RPKs) in 2020.
China’s domestic aviation market fell first, at the start of

the year, but was recovering by March. As the disease
spread, its impact on air transport was felt globally, begin-
ning in February to a low point in April, when passenger
traffic was down 94% from the year before and much
of the industry was grounded. Recovery since has been
disappointingly slow for most markets.
11
Air connectivity collapsed in April 2020 City pair connections in April 2019
Source: IATA Economics, using data under license from Flight
The consequences of travel restrictions grounding much Radar 24
of the airline industry in April were widely felt. Air service
connections between cities worldwide collapsed. Some
service continued in the domestic markets of China,
which began recovering in March, and of the United
States. But the majority of scheduled intercontinental
connections between cities disappeared. Freight con-
tinued to fly, but since around half of air cargo is carried
in the holds of passenger flights the near cessation of
passenger flights caused a serious problem for the global
supply chains our modern economy relies on.
Precrisis air connectivity is essential for the modern City pair connections in April 2020
economy Source: IATA Economics, using data under license from Flight
Radar 24
The precrisis route map shows the air connectivity lost, as
a result of COVID-19. Most of the air services connect-
ing cities in the European single market cross national
borders, many of which have travel restrictions preventing
a significant resumption of service. Most importantly for
world trade, the dense city connections across the North
Atlantic and between Europe and Asia have also been
slow to reopen because of travel restrictions, especially
those resulting from second and third waves of COVID-
19. Many of the 87.7 million jobs aviation was supporting
before the crisis are in sectors across economies that rely
on good air transport services. It is estimated that more
than half of these jobs are at risk in 2020.

International air travel has shown little sign of International RPKs
recovery Source: IATA Economics, using data from IATA Statistics
International air travel was hit to a much greater degree

than either domestic air travel or global air cargo. This is
the result of governments imposing travel restrictions
to prevent the import of COVID-19 from outside their
national borders. International RPKs began falling in
February. They collapsed in March and in April to a level
98% lower than in the previous year. The subsequent
lethargic recovery of international air travel has been
extremely disappointing, for airline revenues and for
the connectivity of the global economy. Global RPKs
remained almost 89% lower by September than a year
earlier.
Strongly rising domestic air travel shows a willing- International and domestic RPKs
12 ness to fly Source: IATA Economics, using data from IATA Statistics
Domestic air travel has shown a more encouraging

rise from its low point in April, which, at 87% less than
the previous year, was not as severe as the low point
for international air travel. By April, China’s domestic
air travel market—the world’s second largest after the
US’s domestic market—had been recovering for two
months, as COVID-19 was brought under control and
travel resumed earlier in that market than in other mar-
kets worldwide. But other domestic markets, too, have
since April seen a return of air travel, which demon-
strates that there is pent-up demand at least for leisure
and visiting friends and relatives (VFR) travel.
There is very wide divergence among different Domestic RPKs

domestic air travel markets Source: IATA Economics, using data from IATA Statistics
As the year progressed, we saw very different results

for air travel in the world’s main domestic air transport
markets. China’s air travel market began its recov-
ery early, having hit its low point in February, and by
September was within 3% of its precrisis level, as
China continued to keep COVID-19 cases low. Russia’s
domestic air travel market was fully recovered by late
summer, as the normally substantial outflow of tourists
did not occur; tourists were instead diverted to vaca-
tions at home. Australia’s domestic air travel market,
however, had barely improved by September, continu-
ing to lag at 89% below the year before. Recovery in the
world’s largest domestic market for air travel, the United
States, has also been disappointing, largely because air
travel there has been hit by second and third waves of
COVID-19 cases.

Second and third waves of COVID-19 have reversed Surging COVID-19 cases in Europe
air travel recoveries in many markets Source: IATA Economics, using data from ECDC
The disappointing progress in controlling COVID-19 in

most countries has been the principal factor shaping
air travel in 2020. Domestic air travel, as just discussed,
was largely affected by China’s control of cases and
by the second and third waves of cases in the United
States. It is in Europe where a surge of second-wave
cases is so damaging for a nascent revival of interna-
tional air travel.
Europe’s international air travel “bubble” evaporated Growth in passenger km flown, international markets
Source: IATA Economics, using data from IATA Statistics 13
The gray lines in the chart opposite show that many
international air travel markets remain near their April
lows. This is principally because of travel restrictions.
In May, the easing of restrictions in Europe for inbound
travelers from European countries with a low risk of
importing COVID-19 cases generated optimism for
a European air travel bubble or corridor. Late sum-
mer saw a significant rise in cross-border air travel
in Europe, but a second wave of COVID-19 abruptly
reversed the trend and brought reimposed travel
restrictions. The only other international markets to
show signs of revival are those of North and Central
America. This probably reflects the introduction of
testing rather than quarantine requirements, especially
by a number of Central American countries, for interna-
tional entry.
Signs indicate pent-up demand for leisure travel UK-Canary Islands, Ticket sales growth, Aug-Oct
2020
COVID-19 will undoubtedly change aspects of air Source: IATA Economics, using data from DDS
travel. There are nevertheless signs of pent-up demand
for leisure and VFR travel. When the UK government
lifted the quarantine requirement for passengers from
the Spanish Canary Islands in late October, for example,
there was an immediate surge in bookings to and from
those islands. In one week in late October, bookings
were more than double precrisis levels. Soon after, the
UK closed its borders in a second lockdown, but this
episode demonstrates a willingness to fly, if permitted.

Quarantine is equivalent to a travel ban, but testing National variances in net bookings by travel require-
boosts air travel ment, 1–5 October 2020 vs. 2019
Source: IATA Economics, using data from DDS
Evidence indicates little difference in the adverse
impact on international travel between countries
with open borders but quarantine requirements and
countries with full travel bans. This was the case for
European countries and for Paraguay. People, though,
are prepared to travel by air if quarantine is replaced
with a negative COVID-19 test. In the first two weeks
of October, a number of Latin American countries
requiring only a negative test experienced substantially
higher bookings, by 10–20 percentage points, relative
to countries with quarantine or other severe travel
restrictions.
14
Air cargo traffic has fallen little because it remains Global passenger and cargo tonne km growth
essential Source: IATA Economics, using data from IATA Statistics
Air cargo’s story in 2020 differs from air travel’s. Cargo

volumes were down but nowhere near as much as
passenger numbers. At air cargo’s low point in April,
cargo tonne kilometers (CTKs) flown were down around
a quarter. And by September, air cargo volumes had
risen to just 8% below the previous year’s figures. Air
cargo is, with few exceptions, not a vector for COVID-
19. It remains, moreover, essential to sustaining global
supply chains and to transporting medical equipment
and pharmaceuticals.
The problem for air cargo is capacity shortage International CTKs

Source: IATA Economics, using data from IATA Statistics
Air cargo’s main problem in 2020 is a severe shortage
of capacity due to the grounding of the passenger fleet.
Air freighters are being used to their maximum, with
an extra 20% of capacity squeezed out by increasing
the average number of hours flown and by adding new
freighters to the fleet. In a normal year, nearly half of
cargo volumes would be carried in the holds of passen-
ger aircraft. That capacity, however, was grounded in
April, and the wide-body, long-haul passenger aircraft
that usually provide the most cargo capacity have been
slow to return, as long-haul passenger routes are lim-
ited. As a result, air cargo capacity was still 25% lower
by September than in the previous year.

Air cargo traffic differs widely by trade lane CTK growth by major trade lane
Source: IATA Economics, using data from IATA Statistics
The robust performance of air cargo relative to passen-
ger traffic is unequal across major trade lanes. Most
resilient has been the North Pacific market, where typi-
cally 90% of air cargo is carried by dedicated freighters.
This market, clearly, was barely affected in 2020 by the
grounding of the passenger fleet. By contrast, Asia’s
manufacturing suppliers and assembly plants are typi-
cally served by cargo capacity on international air pas-
senger flights. This trade lane, therefore, was hit hard in
April and is only gradually recovering. Noteworthy are
the stronger recoveries between the Middle East and
Asia and in the North Atlantic, where higher cargo yields
have made it viable to fly passenger aircraft despite low
passenger loads.
15
Business confidence supports air cargo demand Business confidence in manufacturing and services
(Purchasing Managers’ Index)
Demand for air cargo from the global supply chains of Source: IATA Economics, using data from Markit
the manufacturing and services industries has been
sustained by V-shaped recoveries that reflect growing
business confidence amid strong rebounds in output
as economies unlock and return to work. Shipping com-
ponents and finished goods quickly by air is vital. As of
October, business confidence remained above precri-
sis levels, buoying air cargo demand in economies such
as China’s, the US’s, and Germany’s. Recent renewed
lockdowns in Europe, however, will be damaging, as
declining business confidence in France indicates.

The impact on airline finances is devastating Airline revenues more than 60% below precrisis
forecast
Strong cargo revenues in 2020—caused by the impact Source: IATA Economics
of capacity shortages on yields—did little to offset the
collapse in passenger revenues.
Overall operating revenues for the air transport industry

have so far declined more than 60% in 2020. Because
numerous costs in the airline business, including
aircraft fleet and skilled workforce costs, are difficult to
reduce, this revenue collapse has plunged the industry
into an unprecedented loss.
We estimate that loss will exceed $118 billion at the

posttax net level in 2020.
The year’s second quarter was the worst for the indus-
try, and improvement has been sluggish during the Airline losses to exceed $118 billion this year
second half of the year. Travel restrictions in many air Source: IATA Economics Economic Performance of the Airline
16 travel markets continue to depress revenues. Industry, Midyear 2020
Chinese and Asia-Pacific airlines outstripped Domestic market RPKs

carriers elsewhere Source: IATA Economics, using data from IATA Statistics
China has been an exception to lackluster revenues.

The early and full recovery of its domestic market
has played an important role in the business rejuve-
nation of Chinese airlines. Yields were poor as these
airlines sought to stimulate demand, but as year-end
approaches most Chinese airlines have returned to
breakeven and are generating positive cash flows.
Airlines throughout the Asia-Pacific region have bene-
fited from robust cargo revenues because they serve
the region’s disproportionate array of manufacturing
and assembly plants. Other regions have not had the
benefit of resurgent domestic markets or of thriving
cargo markets of a size sufficient to offset the collapse
of international passenger revenues.

Government aid has kept airlines on life support in Government aid to airlines, by type
2020 Source: IATA Economics, using using public information and
data from SRS Analyser, DDS, FlightRadar 24, TTBS, ACIC, The
Given the scale of the air transport industry’s unprec- Airline Analyst annual reports regarding government measures
edented loss, many airlines would have failed if not
for government aid. In fact, only where government
support was minimal, such as in Latin America, have
there been failures or restructurings under bankruptcy.
In North America, Europe, and parts of Asia, airlines
received substantial cash injections from governments.
Total aid for airlines in 2020 amounts to about $173
billion and came in various forms. More than half is
deferred debt or payments that will need to be reim-
bursed as the industry tries to recover.
Airline cash burn was substantial throughout the Airline industry cash burn 17
year Source: IATA Economics
The burden of servicing and repaying the debt incurred

in 2020 adds to the ongoing drain of cash from airline
operations. It is estimated that airlines burned through
more than $50 billion in the year’s second quarter. That
was the worst of the crisis, but the third-quarter finan-
cial results reveal that the cash burn has not diminished
greatly. This is because the restart of many markets
was delayed by continued travel restrictions. As airlines
restructure costs during the fourth quarter of 2020, the
cash burn should diminish. But the further weakness
of revenues ahead of any substantial lifting of travel
restrictions will limit the reduction.
Airlines at midyear faced running out of cash Monthly cash burn of cash and cash equivalents by
end June 2020
The continued cash burn will have severe conse- Source: IATA Economics, using data from The Airline Analyst
quences for the ability of many airlines to survive the
2020 winter months. A comparison of the cash and
near cash assets of a sample of airlines against the
estimated cash burn in the second half of 2020 shows
the median (or typical) airlines have merely eight to
nine months before their cash reserves are depleted.
There are, of course, some airlines with sufficient cash
reserves or assets against which to borrow cash from
the capital markets to last until a vaccine for COVID-19
contributes to a recovery in airline revenues. For most
airlines, though, this is not the case, and they may well
run out of cash this winter without further government
aid.

The figures in brief

Estimated numbers as of 1 November
During 2020...
18
set against 2019, that’s...

But these are
just statistics.
The air travel
collapse puts
19
at risk the
livelihoods
of 46 million
people.
Health and safety in 2020
20

Protecting health and

safety for all
Safety is always aviation’s num- include mask wearing throughout face coverings during their journeys
ber one priority. As the impact of the travel process, enhanced san- for the safety of all passengers and
COVID-19 became clear, aviation itization, health declarations, and crew. Some onboard incidents have
acted quickly to counter the pan- social distancing where possible. resulted in diversions to offload
demic with a series of measures passengers who refused to comply.
aimed at ensuring the health safety The Take-off document was
of the traveling public and all avia- amended in November with three
tion staff. additional recommendations to
guide governments in reopening The low risk of in-flight
IATA and its industry partners borders: testing for COVID-19, transmission
immediately initiated intense dis- implementing public health corri-
Research has shown that the risk of
cussions with global health author- dors (popularly known as “travel
catching COVID-19 on a flight when
ities to reassure governments that bubbles”), and extending regulatory
wearing a mask remains low. The
flying was safe and to harmonize alleviations to March 2021.
high flow rate of cabin air from top
and standardize required health
IATA called for the implementation to bottom, constant filtering of air
measures as far as possible.
of the Take-off guidelines as the through state-of-the-art high-effi-
A strategy was developed involving global standard for safe operations. ciency particulate air (HEPA) filters,
layers of protection to mitigate the In Europe, the European Union having all seats face the same
direction, wearing a face covering, 21
risk of viral transmission. In the first Aviation Safety Agency (EASA) and
instance, suspected symptomatic the European Centre for Disease and sanitization of the aircraft all
passengers were discouraged from Prevention and Control (ECDC), play a part.
traveling, and airlines offered book- agreed to a protocol aligned with
HEPA filters have a more than
ing flexibility. This ensured that sick the international standards set by
99.9% bacteria/virus removal
or at-risk passengers did not feel the June Take-off guidance.
efficiency rate, ensuring that the
pressured to travel.
The guidelines address the entire air supply entering the cabin is
IATA next advocated for standard- journey from the passenger’s per- not a pathway for microbes. Air
ized, contactless electronic health spective. A complementary charter is exchanged 20–30 times per
declarations through government program has been set up by EASA hour on board most aircraft, which
web portals or government mobile to monitor the implementation of compares very favorably with the
applications. It further noted that the guidelines and provide feed- average office space (average 2–3
health screening using measures back. Over 60 organizations serving times per hour) or schools (average
such as nonintrusive temperature millions of passengers have signed 10–15 times per hour).
checks can also play an important up to the charter on a voluntary
IATA’s data collection on the topic
role in dealing with COVID-19. basis.
aligns with a peer-reviewed study
In the United States, the by Freedman and Wilder-Smith
Department of Transportation in the Journal of Travel Medicine.
ICAO Council Aviation Recovery issued guidance that was simi- The Freedman and Wilder-Smith
Task Force larly aligned with ICAO’s Take-off study looked at Emirates flights
guidelines. from Dubai to Hong Kong between
IATA was part of the ICAO Council 16 June and 5 July 2020. There
Aviation Recovery Task Force IATA is clear that to avoid incon- were five flights with seven or more
(CART). The first set of CART sistencies countries should not infected passengers, totaling 58
guidelines, on 1 June, put forward a introduce unilateral health safety COVID-positive passengers on the
series of recommendations to keep measures. To create a safe envi- eight-hour trips, and yet no other
travelers safe in its document, Take- ronment for all, the same guide- passengers picked up the virus. Dr
off: Guidance for Air Travel through lines need to be followed at every Freedman was quoted by NPR say-
the COVID-19 Public Health Crisis. step of the journey, from origin to ing, “The circumstantial evidence is,
Take-off is a temporary, risk-based, destination. your risk is low on a plane, if there is
multilayered approach to tackling rigid masking.”
the spread of COVID-19 during IATA has also reiterated its recom-
air travel. The recommendations mendation to all travelers to wear

Many other studies likewise support Replacing quarantine measures ICAO is asking countries to actively
the low transmission findings for with COVID-19 testing share information with each other
aircraft travel. Airbus, Boeing, and as to ensure implementation in a
Embraer simulations highlight the The imposition of stringent quaran- harmonized manner. These new
importance of aircraft design in low tine measures on arriving pas- recommendations combine with
infection rates. sengers by many governments in the earlier recommendations, to
response to the pandemic has been provide the global standards for the
An Airbus simulation of the air in an a major factor in the collapse of air safe operation of international air
A320 cabin calculated parameters traffic demand in 2020. Traveler services and the implementation of
such as air speed, direction, and opinion research conducted by testing.
temperature at 50 million points Rockland Dutton on behalf of IATA
in the cabin, up to 1,000 times per consistently shows that quarantine The European Union and other reg-
second. The result clearly demon- measures are a barrier to travel. ulators are expected to announce
strates that potential exposure is Around 83% of passengers will not protocols for testing before the
lower on an aircraft with masking travel if quarantine is in place. end of 2020, and IATA is advocating
than when keeping roughly six feet for these to align with CART best
apart in an office or classroom. The development and deployment practices. Practical knowledge is
Boeing and Embraer researchers of rapid, accurate, affordable, in the meantime being gained from
easy-to-operate, scalable, and
22 came to a similar conclusion. the testing programs that already
systematic COVID-19 testing on are part of various travel bubble
In October, the Harvard University departure is an alternative to quar- or travel corridor schemes around
Aviation Public Health Initiative antine measures that would help to the world. The initiative for a single,
released a report that substantiates reestablish global air connectivity. unified approach will need airlines,
that the layered approach instituted It would also give governments the airports, equipment manufacturers,
on commercial aircraft results in confidence to open their borders and governments to work in total
a low risk of SARS-CoV-2 disease without complicated risk models alignment.
transmission during flights. that see constant changes in the
rules imposed on travel. IATA does not see COVID-19
Another report, by the United testing becoming a permanent
States Transportation Command Rockland Dutton’s public opinion fixture in the air travel experience
(US Transcom), reveals that a study research revealed strong support but rather an imperative in the
conducted in August 2020 found for COVID-19 testing in the travel medium term. Policy makers should
that “the overall exposure risk from process. Approximately 65% of consider the economic stimulus
aerosolized pathogens, like corona- travelers surveyed agreed that that only aviation can provide when
virus, is very low.” quarantine should not be required if prioritizing their testing resources.
a person tests negative for COVID- Reestablishing global connectivity
Neutralizing the middle seat on 19. Fully 84% agreed that testing will, for example, preserve travel
aircraft is not effective in com- should be required of all travelers, and tourism jobs, which account for
bating this virus, as it does not and 88% were agreeable to testing 10% of global employment.
create the recommended social as part of the travel process.
distance. Manufacturer studies
demonstrated that cabin air flow ICAO added two recommenda- The overall
features combined with mask tions related to COVID-19 testing Health passports
wearing create the needed equiv- and public health corridors (PHC) exposure risk
from aerosolized
alent social distancing the reduce to the second edition of its CART
transmission risk to low levels. And Take-off guidelines were developed
with airline margins so thin, empty
middle seats are not economically
with the advice of the World Health
Organization (WHO) and published pathogens, like
viable. Stripping out one of every
three seats reduces capacity to a
in November. The new Manual on
Testing and Cross Border Risk
coronavirus, is
maximum of 66%, and most airlines
need a higher load factor than that
Management Measures is a key
enabler of IATA’s call for system-
very low.
to break even. atic testing before departure for United States Transportation
international travelers. On PHCs Command (US Transcom)

23
To reopen borders without quar- The ITP is neither the first nor In Safely Restarting Aviation—ACI
antine and restart aviation, gov- only solution available. It is unique, and IATA Joint Approach, the air-
ernments need to be confident however, in that it is developed port and airline sectors endorse the
that they are mitigating the risk of specifically for the industry, by WHO position that public funding
importing COVID-19. This means the industry, leveraging as it does of health measures should be
having accurate information on IATA’s position as a trusted industry ensured. This includes but is not
passengers’ COVID-19 health partner and core competency of limited to funding infrastructure or
status. developing industry standards. operational changes needed for the
implementation of such measures.
Travelers will need a digital platform
that informs them of what tests, Having the cost of health mea-
vaccines, and other measures they sures borne by governments will
require prior to travel and where Health costs enable the industry to focus its
they can access these measures. scarce resources on reconnecting
Passengers will also need a means The WHO’s International Health the world and boosting economic
of sharing this information in a Regulations require governments to recovery.
verifiable and privacy-assured way pay the costs of health measures,
with governments. To address this including mandatory testing. Where
challenge, IATA is launching the a test is offered on a voluntary
IATA Travel Pass (ITP). basis, it should be priced at cost.

Relief measures in 2020
24
Government aid
The countries that committed to financial relief for aviation early on in the crisis include
Australia, Brazil, China, Colombia, Denmark, Finland, Hong Kong, New Zealand, Norway,
Qatar, Singapore, Sweden, and the United States. The relief was divided into three broad
categories: wage subsidies, equity financing, and tax relief or subsidies.
The US government passed its Coronavirus Aid, Relief, and Economic Security Act
(CARES). And through CARES, it provided about $25 billion in financial assistance to the
airline industry.
European countries implemented diverse financial packages. The French and Dutch gov-
ernments gave €10 billion to Air France/KLM, Germany agreed to a €9 billion rescue deal
for Lufthansa, and Sweden initiated a loan guarantee scheme worth about €455 million.
In Asia-Pacific, various governments pledged support for aviation. Airport Authority

Hong Kong (AAHK) provided a HK$2 billion fund for the industry there, and the govern-
ments of Australia and Thailand granted their airlines respite on charges and fees.

Securing financial and

regulatory relief
Even before the declaration of assist the industry. The results, Debt levels
the global pandemic, the aviation however, were patchy. Some airlines
industry was feeling the impact of received aid and averted bank- Airlines that emerge from the crisis
sharply slowing demand. Revenue ruptcy, but others got no support. A will do so with higher levels of debt
passenger kilometers (RPKs) few of the latter have ceased oper- and with a higher cost of debt.
flown collapsed more than 14% ating, and many of the remainder
Airlines entered 2020 with cumu-
in February. By 5 March, IATA was have severely retrenched services.
lative debt of $430 billion, roughly
supporting calls for governments Unless there is a significant uptick
half their combined annual reve-
to instigate airline relief measures in international travel, which looks
nues. Relief measures by govern-
as the implications of the dramatic unlikely while border restrictions
ments have added about $120
slowdown in air traffic became and quarantine regulations are in
billion to that total, equivalent to
clear. place, governments will need to
about 92% of expected revenues
consider further financial support
Tens of millions of jobs in aviation in 2021.
for the industry.
and the wider travel and tourism
It is necessary, therefore, that relief
industry were at risk. And only Governments also need to recon-
measures be continued. Moreover,
direct financial relief or government sider the conditions that they
those measures should focus on
salary support schemes would pre- attach to their aid packages. The
helping airlines generate working
vent an employment catastrophe. cash injection for troubled airlines
capital and stimulate demand and 25
from the French government is a
not expand their debt.
case in point. In return for financial
aid, carriers in France were required Further relief for the air transport
2020 financial forecasts
to cut their domestic emissions industry is a solid investment for
In June, IATA released its first and invest in more fuel-efficient governments looking to boost
financial forecast for 2020. The aircraft, which just added to airlines’ economies that have slipped into
headline figures—a loss of $84.3 financial hardship. Much of the recession. Each airline job saved
billion and revenues down 50%, to government support, in France and supports 24 jobs in the broader
$419.0 billion—reinforced the need elsewhere, moreover, was simply in economy, and the Air Transport
for financial relief to preserve the the form of loans whose repayment Action Group estimated in its
industry and its jobs. IATA revised has only added to industry debt. October Aviation Benefits Beyond
its outlook for 2020 in November Borders report that some 4.8 million
The industry’s recovery is expected
as the full-year impact on the airline aviation workers’ jobs are at risk
to be long and challenging. The
industry of the COVID-19 pandemic from the pandemic-induced col-
crisis of the COVID-19 pandemic,
became clearer. The 2020 loss is lapse of air travel demand.
which was finally declared as
now predicted to be an unprec-
such on 11 March, is more pro- It is in the interest of governments
edented $118.5 billion, and the
tracted than envisaged. Airlines to provide ongoing support to
industry’s revenues are estimated
are expected neither to turn cash maintain a viable aviation industry.
to collapse to $328.0 billion.
positive until 2022 nor to see their Preserving airline networks and the
traffic levels recover until 2024. jobs of skilled industry workers is
crucial if aviation is to continue its
Financial support from In the meantime, the initial govern-
support of global supply chains and
governments ment cash injections in support
to effect a return to global eco-
of the industry are running out.
IATA joined forces with industry nomic growth and prosperity.
In October 2020, IATA estimated
partner organizations, such as that the average airline had just
Airports Council International 8.5 months of cash left. Further
and the International Federation government support is required to Regulatory relief
of Transport Workers, to argue avoid a catastrophe for the indus-
for swift financial support for the try and its employees, direct and In addition to financial assistance,
industry. indirect. airlines need temporary regula-
tory relief. One of the most useful
About $173 billion was pledged by regulatory adjustments that can be
various governments to financially granted is a global waiver on the

use-it-or-lose-it 80-20 slot rule. apparent that a slots waiver would Safety Agency published templates
The severe uncertainty in their also be required for the 2020 for extending the validity of various
markets makes it more necessary winter season (October 2020– licenses and certificates. The
than ever for airlines to have the March 2021). IATA called for this United Arab Emirates’ General Civil
flexibility to alter their schedules to in June and continued to lobby for Aviation Authority, the Civil Aviation
meet demand without the pressure it throughout the summer. After Administration of China, the UK Civil
of being penalized for not using considerable delay, the European Aviation Authority, and the Agencia
allocated slots. Commission (EC) indicated it would Federal de Aviación Civil in Mexico
grant the waiver, subject to con- are among the regulatory bodies
In early March 2020, the industry ditions voluntarily proposed by that have also recognized the need
went public with its call for relief airlines and airports. for flexibility in training, crew, air-
from the slot rules. Europe was the worthiness, and air traffic manage-
focal point, as it contains about A full-season winter slots waiver ment requirements.
half of the world’s slot-regulated will avoid the need to fly empty
airports. The European Union (EU) aircraft to maintain slot allocations The need for flexibility must be
was urged to suspend the 80-20 and enable flights to be operated balanced by the need to mitigate
rule for the summer season and in a sustainable manner. It will give any risks associated with prolonged
did so on 13 March, following airports and airlines certainty in regulatory alleviation and to retain
26 significant advocacy from IATA planning their schedules, save critical skills. The ICAO Council
and airlines. Regulators around the millions of dollars in unnecessary Aviation Recovery Taskforce guid-
world, including in Australia, Brazil, costs, and ensure that passengers ance recommends that alleviations
China, Mexico, New Zealand, and know what to expect in the tough not extend beyond 31 March 2021
Singapore, then granted similar winter months. unless circumstances dictate oth-
waivers. erwise. It also encourages countries
There are many other examples to facilitate access to medical and
As the crisis continued and traf- of actions by regulators to aid the training facilities, including flight
fic numbers stalled, it became industry. The European Aviation simulators.
Government financial aid % of 2019 industry revenues

IATA, meanwhile, introduced its more flexible. All airlines agree that
IOSA Support Program, which tem- every traveler should be treated
porarily extends IATA Operational fairly and given what they are owed.
Safety Audit (IOSA) registrations Flexibility on EU261 and like regu-
and, where needed, offers remotely lations elsewhere will ensure this
conducted audits. Airlines are and keep aviation viable during this
required to complete an IOSA crisis.
safety questionnaire at a minimum
of every 60 days. The IOSA Support Yet airlines faced a situation in the
Program will be maintained and United States similar to the one in
adjusted throughout the crisis with- Europe. Authority over US aviation
out compromising audit integrity consumer protection regulation
and stakeholder acceptance. resides with the Department of
Transportation (DOT). And in April
2020, the DOT confirmed that it
would continue its long-stand-
Vouchers ing policy of requiring carriers to
provide prompt cash refunds to
As airlines’ cash flow diminished,
they began asking customers to
ticketed passengers when carriers 27
cancel passengers’ flights or make
accept refundable vouchers instead
significant changes in flight sched-
of monetary refunds. Refundable
ules that passengers choose not
vouchers enable airlines to pre-
to accept. The DOT did, however,
serve cash to survive the crisis
note the unprecedented nature of
and give customers the opportu-
the COVID-19 crisis and say that it
nity to simply delay their trips as
would use its discretion in enforcing
necessary.
policy.
In Europe, IATA requested a tempo-
As in Europe, IATA lobbied to sup-
rary and clearly drafted adjustment
port US airlines. IATA requested that
of the EU261 passenger rights
the DOT allow airlines flexibility in
regulations to permit refundable
managing historic levels of refund
vouchers as an alternative to cash
requests at a time when they face
refunds. EU261 was not designed
severe cash flow issues.
to deal with the mass cancellations
caused by government-imposed There is no benefit in airlines run-
lockdowns. Some 16 EU nations, ning out of cash. The world requires
representing 70% of the EU’s pop- air connectivity. The employment
ulation, reflected their recognition of millions of people throughout
of this by their support for IATA’s the air transport industry and
request. The EC, however, merely the travel and tourism industry
issued a statement clarifying the depends on viable airlines. A robust
status quo. aviation network is vital if essential
resources are to be transported.
There is little doubt that EU261
Despite the shutdown and patchy
remains unfit for purpose. Its reform
relief support provided by govern-
is urgent; EU261 must be made
ments, the industry has continued
to work hard to keep the world
moving and to fulfill its mission to
connect the globe.

Connectivity in 2020
28
Estimated numbers as of 1 November

Maintaining connectivity
during the pandemic
Ensuring the world keeps flying exchange policies. This gave travel In the early days of the crisis, air
agents timely access to voucher cargo was pivotal in supplying per-
Despite the unprecedented col- and ticket exchange information sonal protective equipment (PPE)
lapse in air traffic demand caused from each participating airline. and medicines to destinations glob-
by COVID-19 restrictions, the world ally. Its positive impact continues
continues to need air connectiv- All in all, IATA’s proactive responses as the global lockdown persists.
ity. And the aviation industry has to the crisis saw it extract about Some 46,000 special flights have
responded. Nearly 40,000 dedi- $20 million from the year’s opera- transported 1.5 million metric tons
cated repatriation flights carried tional expenses of the IATA settle- of cargo.
more than five million people home ment systems to cover staff-related
after borders were closed in March. costs and information technology But the number of freighter aircraft
Over 250,000 free tickets were (IT) spending. Global Distribution was insufficient to compensate for
distributed to medical staff globally Systems, too, were involved in the 40–45% decline in belly-hold
to enable the swift and cost-effec- important discussions regarding capacity. So passenger aircraft
tive transfer of essential medical and, indeed, supported airline finan- were reconfigured for all-cargo
resources. Global supply chains cial liquidity. flights. To help with this, IATA pub-
were kept operable by the air cargo lished guidance to deal with regu-
network. IATA’s approach to managing latory hurdles. Cargo, for example,
its financial settlement systems cannot be carried on seats unless 29
through the pandemic is being approved by civil aviation authori-
guided by the principles of ties. Further approvals are required
Supporting the travel agent
sector if airlines decide to remove seats.
• keeping cash flowing while pro-
And, of course, the transport of
tecting the systems through a
IATA’s travel agent partners have dangerous goods in the passenger
balanced approach and excep-
been as deeply affected by COVID- cabin and the weight restrictions on
tional risk management controls
19 disruptions as airlines. Early on overhead compartments had to be
at agent, airline, and clearing
during the crisis, IATA established considered and approved.
bank level;
weekly calls with the Passenger
Agency Conference Steering Using the passenger cabin for
• applying flexible measures given
Group (PSG), which represents cargo, however, makes a big differ-
the extraordinary circumstances
airlines, and the Passenger Agency ence to the amount of cargo that
in accordance with IATA resolu-
Programme Global Joint Council can be carried. Somewhere in the
tions and IATA Clearing House
(PAPGJC), a collaboration of region of 1,000–1,500 extra boxes
regulations; and
airlines, the United Federation of can be accommodated, although
Travel Agents (UFTAA), and the • engaging with IATA members getting them into the cabin through
World Travel Agents Associations and with governance bodies passenger doors and packing them
Alliance (WTAAA). The calls through frequent and regular are further obstacles that can only
addressed urgent COVID-19 issues communication. be overcome with a human chain.
that airlines and agents were expe-
There were and are many chal-
riencing and resulted in the follow-
lenges for air cargo to tackle. IATA
ing initiatives:
Revealing how crucial air cargo is works tirelessly with ICAO to urge
• Exceptions for late payments to global supply chains and medi- governments worldwide to take the
and the late submission of finan- cal response necessary steps to sustain global
cial statements and securities by logistics.
agents The impact of COVID-19 restric-
tions on air connectivity was swift For the most part, there has been
• Approval for cash deposits as a and significant for air cargo. Belly good response from governments,
temporary solution for agents to hold capacity declined sharply with but operational difficulties persist.
bridge gaps in financial security the grounding of passenger flights. Airports, for instance, especially
amounts Air cargo nonetheless remains criti- alternative airports used in emer-
cal to moving goods and to sustain- gency situations, need to be kept
IATA also launched a central repos- ing public health and economies functioning. Many of these second-
itory for airline vouchers and ticket worldwide. ary facilities, though, lost service

amid the pandemic and so were
effectively shut down.
Safely delivering COVID-19
Major hubs, meanwhile, remain
vaccines will be the mission of
open, but with existing slots and
curfews. These need to be changed
the century for the global air
or waived to allow cargo flights to cargo industry.
operate. And because most of the
cargo flights are chartered, permits
must be fast-tracked. be ready and available, as must This could be a challenge given
trained staff. Robust monitoring that, as part of efforts to prevent
Crew regulations are another regu- capabilities will also be needed to COVID-19 spread, many govern-
latory obstacle. Clearly, crews can’t ensure the integrity of the vaccines. ments have implemented measures
observe 14-day quarantine periods. that increase processing times.
Exemptions are therefore needed Security arrangements must be in
to allow crew members to return place to safeguard vaccine ship- Priorities for border processes
home to their families while taking ments from tampering and theft. include the following:
into account all possible safety The potential volume of those
shipments calls for early planning • Introducing fast-track proce-
measures.
30 on security measures to ensure that dures for overflight and landing
all security-related precautions are permits for operations carrying
scalable. COVID-19 vaccines
Transporting vaccines
Border processes, meanwhile, • Exempting flight crew members
Air cargo’s well-established global from quarantine requirements to
demand correct regulatory approv-
time- and temperature-sensitive ensure cargo supply chains are
als and customs clearances for the
distribution systems will be critical maintained
timely transport of the vaccines.
in carrying COVID-19 vaccines
to the world whenever vaccines
become available.
The scale of that activity will be

vast. In September, IATA Director Air cargo regulatory assistance
General Alexandre de Juniac made
it clear that “safely delivering The COVID-19 crisis has resulted in unique challenges for the
COVID-19 vaccines will be the mis- air cargo industry, particularly in light of government health and
sion of the century for the global air safety restrictions. The challenges include delays in getting
cargo industry.” charter permits, a lack of exemptions on COVID-19 testing for air
cargo crew, and inadequate ground infrastructure to and from and
Cold-chain transportation will be within airport environments.
vital for vaccines that require con-
sistent low temperatures. Facilities In response, IATA is urging governments to
and equipment specific to the stor-
age and handling of vaccines must • cut the paperwork for charter operations;
• exempt cargo crews from quarantine rules that apply to the

general population;
• ensure adequate staff and facilities to process cargo

efficiently;
• recognize mutually agreed global standards, such as for health

certificates and licenses; and
• make alternate airports available even in the absence of pas-

senger flights.

Guidance for the industry
IATA experts, working with professionals from the airlines and
elsewhere in the aviation industry, developed a large number of
guidance documents for handling COVID-19.
The COVID-19 hub on iata.org gathers all this information in

one easy-to-access list. Among the key documents are the
Roadmap for Restarting Aviation, Aircraft disinfection during and
post-pandemic, and Guidance for cabin operations during and
post-pandemic.
Also accessible from the hub is a COVID-19 dashboard on

national and airport restrictions that gives airlines rapid access
• Supporting temporary traffic to the latest operational rules being put in place by governments
rights for operations carrying worldwide.
COVID-19 vaccines where
restrictions may apply
• Removing operating hour guidance (see box) and adjusted day. IATA has also launched an
curfews for flights carrying its financial systems and consul- alerts service on Timatic so that
COVID-19 vaccines to facilitate tancy products to suit the exacting subscribers get real-time notifica-
the most flexible global network circumstances under which airlines tions for all travel updates related to
operations now find themselves operating. It the pandemic.
developed regular bulletins and
• Granting priority on arrival of vital These new resources for travel
communications for internal and
COVID-19 shipments to prevent planning are timely and important.
external use and a suite of info-
possible temperature excursions The Rockland Dutton survey also
graphics for sharing by the indus-
due to delays reveals that more than 80% of
try on social media. As the crisis
worsened, moreover, Alexandre de travelers are as concerned about
• Reducing or eliminating tariffs
Juniac gave weekly media briefings. potential quarantines as they are
to facilitate the movement of
about actually catching the virus.
COVID-19 vaccines
Airlines, too, have worked hard to 31
keep passengers informed. The Other free and commercial prod-
Capacity for handling substantial
Rockland Dutton survey found that ucts developed by IATA exclusively
shipments of COVID-19 vaccines
79% of people surveyed agreed to help airlines negotiate the crisis
is also an issue to contend with.
that airlines were being “transpar- include these offerings:
Providing a single dose to each of
the planet’s 7.8 billion people will ent in communicating measures
• A free three-month access to
fill 8,000 Boeing 747 cargo aircraft. that they are taking to keep flying
Turbulence Aware, a real-time
Land transport will help, of course, safe.”
database of turbulence reports.
especially in developed economies
In aid of airline communication, IATA
with local manufacturing capacity. • Discounted training to help peo-
developed an information hub at
But vaccines cannot be delivered ple acquire new skills and new
www.iata.org that includes a free
globally or in timely fashion without jobs. Some training was even
online interactive world map that
the significant use of specialized air offered free, and many courses
provides travelers with the latest,
cargo transport. are available for just $75 in honor
country-by-country COVID-19
of IATA’S 75th anniversary.
entry regulations. The map relies
on IATA’s Timatic database, which • Free webinars hosted by industry
Supporting the industry and contains comprehensive informa- experts on a variety of topics.
travelers tion on the documentation required
for international travel. • The International Airline Training
IATA supports industry efforts to Fund launched a new virtual
keep the world connected through- To keep pace with the dynamic training program of 29 courses,
out the pandemic and beyond. To COVID-19 situation, IATA updates benefitting 58 African airlines.
that end, the association published Timatic more than 200 times per

A year of
progress — in
safety, costs,
32
sustainability...
Connecting
more people
than ever
before.
33
Normal.
Before the storm:
2019 in review
2019 in review
Growth in passenger volumes but
declines in cargo volumes
Air transport connected more cities at lower cost in Unique city pairs and the real cost of air transport
2019 Sources: IATA, Schedule Reference Service (SRS) Analyzer
In 2019, airlines continued to increase the number of

city-pair routes they operate globally, with more than
22,000 unique city pairs regularly serviced. This was an
increase of almost 1,000 over the number of city-pair
connections in 2018. Meanwhile, the inflation-adjusted
cost of air travel declined a further 2.3% in 2019.
The doubling in air connectivity and the halving of air

travel costs over the past two decades have secured
aviation’s position as “the business of freedom.” They
have led to the democratization of air travel, making
it possible for more people to fly more often to more
destinations around the world.
34 Supported economic growth and prosperity through Air tourist spending and the value of trade by air
tourism and trade Sources: IATA, World Travel & Tourism Council (WTTC), IHS
Markit
Air transport is central to world tourism and trade.
Tourists traveling internationally by air are estimated to
have spent about $900 billion in 2019, a solid increase
of some 7% over 2018. The additional number of city-
pair connections and the lower cost of air transport
also boosts trade in goods and services and heightens
foreign direct investment and other important eco-
nomic flows.
Air transport accounts for only a small proportion, less

than 1%, of world trade by volume but for a much larger
share by value, at about 35%. In 2019, the value of
goods carried by air is estimated to have been slightly
above $6.7 trillion.
And was more accessible for more people than ever Accessibility of air travel
before Sources: IATA, International Monetary Fund (IMF)
Worldwide air passenger numbers continued to rise in

2019, moving beyond 4.5 billion passenger journeys on
a flight-segment basis. In 2000, the average citizen flew
just once every 44 months. In 2019, the time between
passenger trips had dipped below half that time, to just
20 months.

2019 in review
Passenger demand slowed but remained solid RPK versus world GDP growth
Sources: IATA, IMF
Demand for air passenger services remained solid in
2019, with industry-wide revenue passenger kilometers
(RPKs) increasing 4.2%.
RPK growth, however, fell below the long-run industry

average growth rate (estimated to be 5.25%–5.50%) for
the first time in seven years. Air travel demand in 2019
was adversely affected by a softer global economic
backdrop and weaker business confidence amid inter-
national trade tensions, especially between the United
States and China.
China’s domestic market once again added the most Top 10 increasing O–D markets 35
passenger journeys Source: IATA Direct Data Solutions (DDS)
Despite the moderation in global RPK growth, there

were more than 3.9 billion origin–destination (O–D)
passenger journeys worldwide in 2019.
Among them, domestic routes within China again

provided the largest incremental increase in passen-
ger trips. China’s market added more than 30 million
journeys during the year, compared with 2018, a brisk
annual growth rate of 5.8%. The US domestic mar-
ket followed, with almost 27 million more passenger
journeys in 2019 than in 2018, growing at a robust 4.6%
pace for the year.
The US domestic passenger market continued to be Largest O–D air passenger markets in 2019
the world’s largest Source: IATA DDS
Although China’s domestic market added the most

passenger journeys in 2019 compared with 2018, the
US domestic market remained the world’s largest single
O–D air travel market.
Unsurprisingly, the largest domestic travel markets

dominated the O–D rankings for 2019. Spain–UK was
the top international country pairing, at number 10. The
top 12 markets accounted for almost half of the total
number of O–D passenger journeys in 2019.

2019 in review
Air cargo volumes declined in 2019 Air cargo versus global goods trade growth
Sources: IATA, Netherlands CPB
Air cargo volumes began to decline in the fourth quar-
ter of 2018 and continued declining throughout 2019.
This resulted in the worst performance for the air cargo
segment since the global financial crisis in 2009. Not all
air freight sectors were equally affected, however. The
e-commerce and pharmaceuticals sectors, for exam-
ple, performed well in 2019.
Overall, though, cargo tonne kilometers (CTKs) con-

tracted a sizable 3.2% year on year, the first negative
result for CTKs since 2012. Global goods trade growth
likewise slowed, from 3.7% in 2018 to just 0.9% in 2019,
the weakest performance since 2009.
36
Regional differences were evident in passenger and, Regional passenger and freight demand outcomes
more so, in cargo outcomes Source: IATA
The mixed fortunes of the air passenger and cargo mar-

kets at the global level were reflected in outcomes at
the regional level. Passenger market results, however,
showed less regional variation than cargo.
With the exception of the Middle East, the air passen-

ger growth performance in RPK terms was consistent
across regions in 2019. It ranged between 3.9% for
North America and 4.8% for Asia-Pacific.
The air cargo growth performance across regions was

more mixed. Only the African carriers saw their CTKs
increase compared with 2018, at a strong rate of 7.4%.
In contrast, airlines based in Asia-Pacific and in the
Middle East were the weakest performers in 2019, with
volumes falling 5.6% and 4.6%, respectively. Because
US-China trade tensions have a profound effect on air
cargo developments internationally, it is little surprise
that the Asia-Pacific market—a global manufacturing
and distribution hub—was heavily affected in 2019.

2019 in review
Passenger load factor attained a record high in 2019 Industry-wide passenger and cargo load factors
Source: IATA
The air passenger market’s available seat kilometers
(ASKs) increased a moderate 3.4% globally in 2019
compared with 2018, the slowest pace since 2009.
The grounding of the Boeing 737 MAX aircraft played
a role in this subdued, industry-wide capacity growth
outcome. Rising demand, reflected in the 4.2% increase
in RPKs, outpaced capacity growth and increased the
passenger load factor (PLF) around half a percentage
point, to 82.6% for 2019. This was the eighth consecu-
tive yearly increase in PLF and a record high.
The contrasting fortunes for air cargo were clear.

Available cargo tonne kilometers (ACTKs) increased
2.2% year on year, a pace that was some 5.4 percent-
age points faster than the rate of demand growth. As
a consequence, the cargo load factor (CLF) declined
substantially in 2019, around 2.5 percentage points.
37
Oil prices were steady and moderate for much of World oil and jet fuel prices
2019 Sources: Datastream, Platts
The yearly average jet fuel price for 2019 was slightly
below $80 a barrel. This was down from an average
in 2018 that exceeded $86 a barrel and was, overall,
a moderate level compared with the past 15 years.
What this meant for airlines was that the cumulative
unhedged annual fuel bill, excluding handling costs, was
$9.5 billion lower in 2019 than in 2018.
The achieved load factor eased slightly but remained Breakeven and achieved load factors
solidly above the breakeven level Sources: IATA, The Airline Analyst
The main contributors to airline costs, including oil

prices, interest rates, and labor costs, were stable in
2019. And that underpinned an essentially unchanged
estimate for the industry-wide breakeven load factor, at
65.9%, compared with 66.0% in 2018.
The record PLF in 2019 was countered by the sharp

decline in the CLF. As a result, the combined achieved
industry-wide load factor—measured as a share of
available tonne kilometers (ATKs)—eased by around
half a percentage point, to 69.4%.

2019 in review
Air transport’s financial performance was robust, but Industry return on investment and the cost of capital
returns remained below the overall cost of capital Sources: IATA, Datastream, The Airline Analyst
The global airline industry experienced another year of

robust financial outcomes in 2019. Airlines generated
an industry-wide net posttax profit of $25.9 billion, with
an operating margin (EBIT) forecast to be 5.1%.
Despite moderating for a fourth consecutive year in

2019 following its peak in 2015, the industry-wide
return on invested capital (ROIC) remained elevated
relative to historical terms, at 5.7%. The cost of capital
eased in 2019, returning to its 2017 level, and remained
above the level of ROIC.
38
Regional financial performance was varied Regional profit performance
Sources: IATA, The Airline Analyst
Globally, the industry’s EBIT decreased in 2019, to an
estimated 5.1% of revenues, from 5.7% in 2018. Across
regions, industry financial performance remained
mixed. North American airlines continued to lead the
way, delivering an operating margin of almost 10% in
2019, up about half a percentage point on the previous
year.
Similar to 2018, airlines in Europe, Asia-Pacific, and

Latin America recorded moderate profitability, with
operating margins ranging from 3.5% to 4.7%. Airlines
in the Middle East and in Africa faced more challenging
business conditions, and those in the Middle East in
particular had an overall negative operating margin of
-5.2%.
Latin America joined North America in being the only

two regions where airline operating margins improved
in 2019 compared with 2018.

The figures in brief
2019 in review
During 2019...
39
and from 2000-2019...

Continuing the strong
Safety
industry progress
Safety
More than 4.5 billion passengers

flew safely on 46.8 million flights.
All major safety performance indi-
cators improved in 2019 compared
with 2018 and the average over the
2014–2018 period, as shown in the
table opposite.
Toward enhanced skills and safety
In 2019, the International Airline

Training Fund (IATF) contributed to
developing the skills and strength-
ening the capabilities of 3,982
aviation industry professionals from
developing nations. The IATF spon-
sored 191 events, 110 aimed at
40 enhancing aviation safety and help-
ing airlines with IOSA registration.
The IATA Standard Safety

Assessment (ISSA) Implementation
Training Program gained momen-
tum in Latin America. This resulted
in six registrations: Twoflex,
Amaszonas Línea Aérea Bolivia,
Amaszonas Uruguay, Asta Linhas
Aéreas, Rima, and Sansa. *There were also seven fatalities on the ground in the accident involving Busy Bee Congo.
More information on the industry’s

safety performance can be found
in the IATA Safety Report.

Learning from evolving
Security
threats
Security
The partnership between govern- Aviation cybersecurity Conflict zones

ments and the aviation industry
is the foundation on which a safe, To address cyber threats and Safety and security risks associ-
secure, and accessible air transport ensure the civil aviation industry is ated with conflict zones continue
network is built. Aviation security resilient to cyberattacks, in 2019 to be major concerns for aircraft
policy must learn from evolving the ICAO Aviation Cyber Security operators. The downing of Ukraine
threats. IATA pursues security Strategy was endorsed. Following International Airlines flight 752 on
policies based on global standards, the ICAO 40th Assembly, the need departure from Tehran in January
with an outcome-based risk-mitiga- for countries and the industry to 2020 underscores the imperative
tion approach. take further action to counter cyber that airlines require access to rele-
threats was emphasized. Therefore, vant and corroborated information
ICAO was called upon to develop a from governments to perform accu-
cybersecurity action plan to facili- rate risk assessments.
tate the adoption of its strategy.
IATA and its members support the
IATA strongly supports the ICAO evolving changes to Annexes 6,
position as the most appropri- 15, and 17 regarding enhanced
ate way to drive coherent global risk assessment requirements for
dialogue and action on aviation operators in dealing with conflict
41
cybersecurity. The association is zones. In 2019, moreover, IATA
collaborating closely with ICAO’s released a security incident data-
Secretariat Study Group on base that provides member airlines
Cybersecurity (SSGC) and Trust with a tool that collates a range of
Framework Study Group (TFSG) to open-source information. That tool
contribute to the development of establishes a baseline of informa-
the cybersecurity action plan. tion that will help airlines formulate
the required safety and security risk
assessments.

Smart regulations for
Regulation and taxation

healthier air transport
The industry pursued its need Unruly and disruptive passengers Under this MOU, the WSG have
for smart regulations and the been rebranded as the Worldwide
avoidance of excessive or poorly In 2019, IATA launched public Airport Slot Guidelines (WASG). The
targeted taxation in 2019. This awareness campaigns in partner- two last editions of the WSG were
resulted in several noteworthy ship with the travel retail indus- published in January and August
developments. try and regulators in the United 2019. They incorporate changes
Kingdom and Sweden highlight- agreed to through a strategic review
ing the consequences of unruly involving airlines, airports, and
passenger behavior. Progress was slot coordinators. Those changes
Smart industry regulations also made in ratifying Montreal update and strengthen the applica-
Protocol 14 (MP14), such that MP14 tion of policy and slot coordination
The aim of smart regulations is
came into force on 1 January 2020, processes.
to enable airlines to connect the
just six years after its inception.
world as efficiently as possible, with
MP14 enhances the legal powers IATA will continue to work through
resulting benefits to global soci-
of countries to deal with offenses the WASB and with its members to
ety. A lead tool for promoting the
onboard aircraft that land in their influence slot regulations worldwide
benefits of smart regulations are
territory, even those committed on to ensure that they remain aligned
the IATA-developed Air Transport
foreign-registered aircraft. with the WASG.
Regulatory Competitiveness
42 Indicators reports, which bench-
mark national performance across
five metrics: Single African Air Transport Taxation
Market
1. Passenger facilitation IATA and its members ran cam-
The number of African nations paigns to avoid excessive or poorly
2. Cargo facilitation signed up to the Single African targeted taxation with the follow-
Air Transport Market (SAATM), an ing significant outcomes totaling
3. Supply chain management
African Union initiative to open $152.6 million in savings in 2019:
4. Infrastructure management Africa’s airspace, increased to 31
in 2019. Only 8, however, have • Argentina: removal of a 1.2% tax
5. Regulatory environment implemented the “concrete mea- on credit and debit card pay-
sures” mandated by the African ments, for a reduction of $6.9
IATA published the first batch of Civil Aviation Commission. IATA’s million;
reports in 2019 in partnership with response has been to publish
local industry stakeholders. They • Italy: reduction in the Council
reports on the benefits of aviation
focused on Europe and were dis- Tax, constituting a saving of $5.3
in numerous African countries that
tributed among policy makers and million;
highlight how important the SAATM
the media. is to increasing such benefits. • Russia: elimination of a 20% val-
ue-added tax (VAT) on services
rendered to international airlines
Slots by airport operators, saving
$140.4 million;
In June 2019, a crucial step
was taken toward reforming the • Bermuda: prevention of the intro-
governance of the World Slot duction of a 5% general sales tax
Guidelines (WSG). IATA, Airports (GST) on air ticket sales, corre-
Council International (ACI), and the sponding to $17.5 million a year.
Worldwide Airport Coordinators
Group (WWACG) signed a memo-
randum of understanding (MOU) to
create the Worldwide Airport Slot
Board (WASB).

Improved access for passengers with disabilities
Safe and dignified travel for all passengers, including those

with disabilities, is an airline commitment enshrined in a
resolution passed at the 2019 IATA AGM. The principles for
accessible air travel endorsed in that resolution were, in turn,
adopted by ICAO at its 2019 Triennial Assembly as high-level
guidance for regulators.
The IATA resolution also commits airlines to building

dialogue with the accessibility community and to bringing
together stakeholders from across the aviation sector.
Toward the fulfillment of this commitment, in November
2019 IATA established the Accessibility Symposium and
designated it an annual event.
Diversity in the workforce

43
Airlines are determined to improve the participation of
under-represented groups at all levels of employment and
are accelerating this process through nondiscriminatory
programs to encourage mentoring and reward talent. The
inaugural IATA Diversity and Inclusion Awards in 2019 hon-
ored three excellent examples of aviation’s progress in this
regard:
• Inspirational Role Model: Christine Ourmières-Widener,

CEO, Flybe;
• High Flyer Award: Fadimatou Noutchemo Simo, Founder

and President, Young African Aviation Professional
Association (YAAPA);
• Diversity & Inclusion Team: Air New Zealand.
In September 2019, IATA announced its 25 by 2025 cam-

paign, which seeks voluntary participation from IATA-
member airlines. Airlines that participate in 25 by 2025
commit chiefly
• to increase the number of women in senior positions by

either 25% against current metrics or a minimum repre-
sentation of 25% by 2025;
• to raise the number of women in under-represented jobs

(e.g., pilots and operations) by either 25% against current
metrics or a minimum representation of 25% by 2025;
• to report annually on key diversity metrics.
The first airlines to sign up to the 25 by 2025 campaign were

China Eastern, the Lufthansa Group, and Qatar Airways. As
of October 2020, 55 airlines have signed onto the campaign.

Cost-effective
Infrastructure
and flexible
Infrastructure
The air transport industry needs A vision for the future • ONE ID will enable passengers
demand-led, fit-for-purpose, to travel document free using
cost-effective infrastructure to The NEXTT (Next Travel biometric recognition.
operate and grow. Toward this Technologies) vision outlines how
aim, IATA released a new version new technology, interactive deci- • ONE Order will result in the grad-
of the IATA Airport Development sion-making, advanced processing, ual disappearance of passenger
Reference Manual (ADRM) in March and moving activities off airport will name records (PNRs), e-tickets,
2019. A review, meanwhile, of the meet changing passenger demand and miscellaneous electronic
ICAO Airports Economic Manual and customer expectations. In documents in favor of a single
focused on ensuring that infrastruc- 2019, a study on the impact on customer order record that holds
ture user charges support competi- airport design of deploying the the data elements obtained and
tive and cost-efficient air services. NEXTT initiative. ICAO also indi- required for product fulfilment
cated support for NEXTT, with the across passengers’ air travel
In 2019, IATA participated in cam- President of the Council requesting journeys.
paigns related to charges and tax- a briefing, and exposure at the ICAO
ation that contributed to an airline world aviation forum and in the • Travel Communications will
cost reduction of $1.34 billion. Key 2019 Aviation Benefits report. enable multiple industry stake-
achievements included holders to communicate with
IATA and Airports Council passengers across all touch
44
• reductions in the en route International (ACI) developed a points of their journey with
charges from Eurocontrol and common program for the future accurate, up-to-date information
Airservices Australia, totaling on-ground travel experience. Eleven provided by a trusted source.
$556 million; key IATA projects were harmonized
under this program of infrastruc- • Smart Security will use stand-
• reductions in the passenger ture, processes, and business to off technologies and data-driven
charge in Trinidad and Tobago, bring the NEXTT vision to life. processes to provide seamless,
airport charges at Dublin airport, efficient, walk-through security
and the value-added tax (VAT) • ONE Record will allow all stake- for passengers and their bag-
rate on jet fuel at São Paulo air- holders in the air cargo supply gage throughout their journeys.
port (totaling $235 million); chain to directly access the ship-
ment data they require, all from a • Enhanced Airport Collaborative
• removal of VAT in its entirety in digital ecosystem. Decision-Making (A-CDM) will
Russia ($140 million). improve the efficiency of the
• Interactive Cargo will ”make aircraft turnaround process
cargo talk,” with intelligent and flight predictability through
systems that self-monitor, send real-time data sharing between
Airport privatization
real-time alerts, and respond to airport partners, reducing airport
Following IATA’s resolution on changes in handling conditions. delays.
privatization, adopted at IATA AGM
• The Cargo Facility of the Future • CEDAR (Ramp of the Future) will
2018, IATA launched a report with
will define what the modern accelerate the modernization of
Deloitte providing a framework for
cargo facility will look like and ground operation processes.
a new model of airport concession
how it will be used.
contracts. • The Airline Industry Data Model
• Baggage Tracking will ensure (AIDM) will provide an agreed-
that every bag is tracked upon dictionary for industry
throughout its journey to vocabulary, data definitions, and
reduce mishandled luggage and their relationships.
increase efficiency in baggage
operations and has already been
agreed to by airlines across the
industry.

Infrastructure
45

Pushing for a sustainable
Environment
future
Environment
Developments in 2019–20 Carbon Offsetting and Reduction plans. This was an important show
Scheme for International Aviation of industry support and solidarity
Awareness of climate change with the ICAO Secretariat ahead of
increased in 2019 as the efforts An important breakthrough in the complex discussions at the ICAO
of environmental protest groups, first half of 2019 was the agree- Triennial Assembly in September–
such as Extinction Rebellion and ment by ICAO on defining the mon- October 2019. In the end, motions
the school strike movement led by itoring, reporting, and verification on CORSIA and a long-term goal for
Greta Thunberg, gathered momen- (MRV) procedures for its Carbon emissions reductions were passed
tum ahead of the Conference of Offsetting and Reduction Scheme at that assembly.
the Parties (COP)25 meeting in for International Aviation (CORSIA).
December. In support, IATA arranged capac- In January 2020, IATA partnered
ity-building workshops to ensure with Xpansiv CBL Holding Group
As part of the industry’s engage- that airlines were compliant with to launch the Aviation Carbon
ment with environmental groups CORSIA requirements. Exchange (ACE). ACE is a cen-
and the general public, the IATA tralized marketplace for CORSIA-
Board encouraged an education At the 2019 IATA AGM, member air- eligible emission units where
campaign to help travelers become lines reconfirmed their commitment airlines and other aviation stake-
more aware of the environmental to the industry’s targets, including holders can trade CO₂ emission
impacts of air travel and of the work carbon-neutral growth from 2020
46 reductions for compliance or
the industry is doing to reduce and cutting emissions to half of voluntary offsetting purposes. The
emissions. A website, www.flyaware. 2005 levels by 2050. A resolution partnership adopted a phased
com, was developed and launched was passed at the AGM urging approach to its different trading
by IATA in February 2020 to begin ICAO member nations to support options, with the full integration of
this outreach. But the consumer CORSIA, to volunteer to implement CBL Markets’ trading platform and
aspects of the campaign were the scheme at the earliest possible IATA’s settlement systems planned
paused amid the COVID-19 crisis, stage, and to integrate the MRV for the final quarter of 2020.
which grounded much of aviation requirements into their national
from March 2020.
Current and projected SAF production
A: The difference between a low take-up of SAF from production facilities B: Without the correct policy measures, the fuel
(lower number) and a high take-up, driven by policy and airline decision-mak- output could be optimized to go to other forms of
ing. The top number represents the full possible output of SAF production in transport. The lowest dotted line represents the
operation or under construction or advanced planning and financing. least take-up of SAF (output goes to road transport).

Environment
As the impact of COVID-19 on Technologies Sustainable fuels
2020 air travel demand emerged,
it became clear that this extreme Offsetting remains a vital short- With the industry reliant on liquid
shock to air travel threatened to term option for mitigating aviation fuels for most services for the
distort the baseline for calculat- carbon emissions. Long term, foreseeable future, the take-up of
ing carbon-neutral growth. ICAO however, new technology, includ- sustainable aviation fuels (SAF)
responded to prompting from the ing sustainable fuels, will be the will be crucial if the industry is to
industry and agreed to modify the solution. IATA published its updated meet its 2050 target of halving
CORSIA baseline to reflect only Technology Roadmap in 2019, emissions. SAF offers potential CO₂
2019 demand levels. This has setting out the milestones for reductions of up to 80% compared
resulted in a tougher emissions expected green technology over with traditional jet kerosene.
offsetting requirement than would the next 30 years. The roadmap
suggests that fully electric com- In 2019, the industry marked the
have been the case if 2020 had
mercial aircraft carrying around 50 milestone of more than 250,000
been a year of similar demand
passengers on short-haul flights commercial flights with a SAF blend.
growth to 2019. ICAO’s modifica-
could be in service from 2035 Increasing the production of SAF as
tion did, however, remove the worst
onwards, with hybrid propulsion rapidly as possible to stay abreast
of the distortion from the collapse
systems in place for long-haul jour- of rising usage remains an indus-
in air traffic demand caused by
try goal. Throughout 2019, IATA
COVID-19. neys also helping to significantly 47
reduce emissions. engaged with fuel producers and
political stakeholders to encourage
investment in SAF production. The
air transport industry, basing itself
on 2019 demand, targets 2% SAF
fuel use by 2025. IATA estimates
that the level of annual production
needed to meet this target—some
7 billion litres—will create a tipping
point to bring prices down and will
encourage a virtuous circle of fur-
ther investment and falling prices.
SAF is our biggest emissions reduction

opportunity. The time is right to push it
forward so that, together, we can achieve
major carbon reductions on the way
toward fossil fuel-free flight.
Alexandre de Juniac

Binding the global economy
Cargo
together
Cargo
Air cargo enables global trade and Safe shipping of lithium batteries Live Animals certification programs
supply chains to operate. Goods in 2019 to complement its CEIV
to the value of one-third of global In December 2019, IATA formed Pharma program. These three
trade—more than $6.7 trillion—are a partnership with the Global programs benchmark the handling
carried by air. Shippers Forum, the International of perishables, animals, and phar-
Federation of Freight Forwarders maceutical products, respectively.
In 2019, airlines saw revenue from Associations, and the International More than 300 organizations are
air cargo fall to $102.4 billion, some Air Cargo Association to amplify certified under CEIV Pharma. To
$9 billion down from 2018 and in efforts to ensure the safe air date, Cathay Pacific, Cathay Pacific
line with falling volumes. Cargo transport of lithium batteries. The Services Limited (CPSL), Hong
tonne kilometers (CTKs) flown fell partners launched an incident Kong Air Cargo Terminals Limited
for the first time since 2012, reflect- reporting tool to share information (HACTL), and Turkish Cargo have
ing a general slowdown in global on rogue shippers and an aware- achieved all three CEIV programs.
economic activity. In such a chal- ness campaign on the dangers of
lenging market, airlines must work shipping undeclared and misde- The digitization of information
with their shipping and freight-for- clared lithium batteries. They also and the exchange of smart digital
warding partners to modernize and called for governments to crack data were boosted with the launch
digitize cargo processes to improve down on manufacturers of coun- of a number of ONE Record test
48 the safety, speed, security, and terfeit batteries and of mislabeled projects in 2019. The vision for ONE
efficiency of cargo services. and noncompliant shipments Record is an end-to-end digital
introduced into the supply chain by logistics and transport supply chain
To this end, IATA promoted the issuing and enforcing criminal sanc- where data is easily and transpar-
international adoption and imple- tions on those responsible. ently exchanged in a digital eco-
mentation of efficient and effective system of air cargo stakeholders,
electronic border measures based communities, and data platforms.
on the World Trade Organization
Trade Facilitation Agreement. This IATA’s development in 2019 of the
Enhanced standards through
should address the wide disparity Smart Facility program is meant to
benchmarking and sharing
in clearance times for international improve transparency on service
information
shipments. The average time taken levels at 3,500 cargo handling facil-
is 2.1 days, but clearance can take In 2019, IATA published enhanced ities. The program reduces audit
up to 4.4 days in some markets. special cargo standards regard- frequency, complexity, and cost
ing the transport of live animals, and makes information available on
perishables, and life sciences ONE Source, a new online platform.
commodities. Through ONE Source, shippers
can find business partners for their
IATA also initiated its Center needs through full disclosure on
for Excellence for Independent everything from temperature-con-
Validators (CEIV) Fresh and CEIV trolled rooms to IATA certifications.
Certification status

Cargo
49

More choice, more control,
Passenger experience
more convenience
In 2019, IATA members represented Baggage What can be said is that the crisis
through the Customer Experience has accelerated the trend to airline
Workstream developed a strategic Also unanimously passed at the retailing. The NDC Leaderboard
roadmap for the automation of a 2019 IATA AGM was a resolution to airlines are, on average, conducting
growing number of airport pro- support the global deployment of more than 20% of their indirect
cesses. These processes include radio frequency identification (RFID) transactions through NDC API. This
improved baggage handling and for baggage tracking. The AGM is off an extremely low base and a
tracking, a single identity token for also called for the implementation traffic mix that leans heavily toward
all travel processes using biomet- of modern baggage messaging domestic, short-haul, leisure, which
ric identification, real-time flight standards to more accurately track is favorable to today’s NDC chan-
information sent directly to per- passengers’ baggage in real time nels. It also shows that the NDC
sonal devices, and seamless border across key points in the journey. continues to be or is perhaps more
control. IATA members committed to relevant than ever.
transition to bar-coded bag tags
The aim is to deliver an ever-more with RFID inlays and to use RFID
personalized and convenient data alerts to enact processes with
experience that puts the passen- airports and ground handlers that ONE Order
ger in control. An added benefit of prevent potential mishandlings.
ONE Order is an industry-led initia-
50 implementing the roadmap will be
tive to simplify the airline fulfilment,
to facilitate the most efficient use of
servicing, delivery, and accounting
constrained airport infrastructure.
New Distribution Capability processes for airline products and
services. These processes are
The focus for the New Distribution largely unchanged from the era of
ONE ID Capability (NDC) for 2019 was paper tickets, even though paper
on driving a critical mass of NDC tickets have all but disappeared.
The 2019 IATA AGM unanimously transactions. To that end, IATA
resolved to accelerate the global established the NDC Leaderboard, In January 2019, IATA launched the
implementation of ONE ID, which composed of airlines that seek to ONE Order certification registry to
aims at seamless and secure grow their NDC volumes rapidly. provide transparency on ONE Order
processing for passengers from The 21 NDC Leaderboard airlines deployments, validate the capability
airport door to gate using col- have set a target of powering 20% of supporting IT providers, drive
laborative identity management. of their sales by NDC application innovation and monitor progress,
This was given a boost when the programming interface (API) by the and support the adoption of ONE
40th ICAO Assembly endorsed the end of 2020. Order.
initiative. Progress in 2020 has to
date included the development At year-end 2019, NDC The COVID-19 crisis has signifi-
of a contactless application and Leaderboard airlines had reached cantly slowed ONE Order imple-
the ONE ID Overarching Process 11% of indirect bookings through mentations. Because of a lack of
Recommended Practice approved NDC API. The COVID-19 pandemic, resources, the industry is focused
by the IATA Travel Board and which led to the virtual shutdown of instead on continuing and maturing
Passenger Service Conference. international traffic (even as of this NDC deployments. IATA is there-
writing), upended airlines’ commer- fore pivoting ONE Order to make
cial strategies as the focus turned it an integral part of a transition to
to business survival. It is, there- retailing. This means moving to a
fore, not possible to say whether world of offers and orders aligned
the 20% target would have been with today’s online retailing best
achieved absent COVID-19. practices. ONE Order assures the
simplification and the customer
service components that are vital to
achieving this vision.

51

Efficient, customer-centric
Financial services
systems
Financial services
IATA Financial Settlement IATA Currency Clearance Services In 2018, IATA began rolling out its
Services (IFSS) facilitate payments (ICCS) offer global cash manage- New Generation IATA Settlement
to airlines from travel agents and ment that enables more than 340 Systems (NewGen ISS) to modern-
freight forwarders, from airlines to airline users to centrally control ize and transform the BSP to ensure
airlines, and from airlines to sup- and repatriate their BSP and CASS that it continues to deliver strong
pliers. In 2019, the IFSS processed sales, including from countries with value to all participants for years to
$449.8 billion. severe currency liquidity issues. come. At the end of 2019, NewGen
Overall, the ICCS processed $37.3 ISS had been implemented in some
IATA’s Billing and Settlement Plan billion in 2019. 98 BSP markets, representing
(BSP) expedites and simplifies the 93.4% of global BSP cash sales.
selling, reporting, and remittance IATA’s Simplified Invoicing and
procedures of IATA-accredited Settlement (SIS) is a cost-effec- NewGen ISS offers
travel agents and improves financial tive electronic invoicing platform
control and cash flow for approxi- that removes all paper from the • three levels of travel agent
mately 400 participating airlines. In invoicing and settlement of industry accreditation, allowing agents
2019, the BSP processed $237.1 services. In 2019, SIS had more to select the level that best suits
billion. At the close of 2019, there than 2,637 participants, including them and to move between lev-
were 154 BSP operations covering 443 airlines, 334 suppliers, and els as their business evolves;
52 180 countries and territories. Their 1,860 others. SIS processed over
• a modern risk management
overall on-time settlement rate was 1.8 million interline and supplier
framework that provides a more
99.994%. The 743 million transac- invoices during the year and settled
secure environment for all partic-
tions processed through all BSPs $76 billion in volume.
ipants, including a remittance
during 2019 resulted in an average
IATA’s Enhancement & Financing holding capacity (RHC) for “cash”
cost per transaction of $0.065, with
(E&F) enables air navigation service sales outstanding to the BSP;
the cost of some transactions as
providers (ANSPs) and airports and
low as $0.04.
access to IATA’s globally trusted
• IATA EasyPay, a new, volun-
IATA’s Cargo Account Settlement systems and processes for the
tary e-wallet solution for travel
System (CASS) simplifies the billing generation of accurate billing data,
agents, including GoLite travel
and settling of accounts between for standardized e-invoices that
agents, for issuing airline tickets
airlines and freight forwarders. It can be automatically validated,
in the BSP in a way that gives
operates through CASSlink, an and for secure fund collection. For
agents a fail-safe means to con-
advanced, global, web-enabled airlines, the E&F can help avoid late
tinue selling even if they reach
e-billing solution. In 2019, CASS payment penalties, reconciliation
their RHC while offering airlines
processed $32.7 billion, with headaches, and disputes through a
a low-cost per transaction and
an on-time settlement rate of standardized billing process with a
faster settlement.
99.996%. At the end of 2019, CASS single point of contact for ques-
was processing 96 operations tions or disputes. The E&F pro- In conjunction with NewGen ISS,
serving over 180 airlines and 200 cessed $4.2 billion in 2019. IATA introduced Transparency in
general sales and service agents Payments (TIP). TIP is focused on
(GSSAs) and ground handling providing airlines with increased
companies. New Generation IATA Settlement
Systems transparency and consent over
travel agents. It allows airlines to
The IATA Clearing House (ICH)
IATA’s BSP offers tremendous value use their own cards for funds settle-
provides fast, secure, and cost-ef-
to the industry by facilitating the ment. As it stands, airlines only see
fective settlement services to 463
distribution and settlement of funds the payment settlement costs after
airlines, airline-associated com-
between travel agents and airlines. the fact, if at all. No form of settle-
panies, and airline travel partner
However, the rules of the BSP were ment is barred by TIP, but agents
participants. In 2019, the ICH
established decades ago, using a can only use forms to which an air-
processed $62.5 billion and had a
one-size-fits-all approach that does line has previously given consent.
financial settlement success rate of
99.996%. not address the different needs,
concerns, and risks of today’s air-
lines and travel agents.

Financial services
BSP CASS
53

www.iata.org
International Air Transport Association
Annual Review 2020

76th Annual General Meeting,
Amsterdam, November 2020

Iata Annual Review 2020

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Annual Review 2020

Annual Review 2020

Note: Unless otherwise specified,

Summary chapter title

10 The industry story in 2020

34 Before the storm: 2019 in review

04 IATA Annual Review 2020

02 IATA Annual Review 2020

M Q TAAG Angola Airlines Y

Mandarin Airlines Tassili Airlines

03 IATA Annual Review 2020

Director General’s foreword

04 IATA Annual Review 2020

05 IATA Annual Review 2020

Frankly speaking, no one can pre-

But one thing is for sure: A global

This is why I’m deeply convinced

06 IATA Annual Review 2020

07 IATA Annual Review 2020

09 IATA Annual Review 2020

10 IATA Annual Review 2020

The industry story in 2020

China’s domestic aviation market fell first, at the start of

11 IATA Annual Review 2020

International air travel was hit to a much greater degree

Domestic air travel has shown a more encouraging

There is very wide divergence among different Domestic RPKs

As the year progressed, we saw very different results

12 IATA Annual Review 2020

The disappointing progress in controlling COVID-19 in

13 IATA Annual Review 2020

Air cargo’s story in 2020 differs from air travel’s. Cargo

The problem for air cargo is capacity shortage International CTKs

14 IATA Annual Review 2020

15 IATA Annual Review 2020

Overall operating revenues for the air transport industry

We estimate that loss will exceed $118 billion at the

Chinese and Asia-Pacific airlines outstripped Domestic market RPKs

China has been an exception to lackluster revenues.

16 IATA Annual Review 2020

The burden of servicing and repaying the debt incurred

17 IATA Annual Review 2020

The industry story in 2020

set against 2019, that’s...

18 IATA Annual Review 2020

20 IATA Annual Review 2020

Health and safety in 2020

21 IATA Annual Review 2020

22 IATA Annual Review 2020

23 IATA Annual Review 2020

In Asia-Pacific, various governments pledged support for aviation. Airport Authority

24 IATA Annual Review 2020

Relief measures in 2020

25 IATA Annual Review 2020

Government financial aid % of 2019 industry revenues

26 IATA Annual Review 2020

27 IATA Annual Review 2020

Estimated numbers as of 1 November

29 IATA Annual Review 2020

The scale of that activity will be

• exempt cargo crews from quarantine rules that apply to the

• ensure adequate staff and facilities to process cargo

• recognize mutually agreed global standards, such as for health

• make alternate airports available even in the absence of pas-