The coronavirus outbreak in China has affected the global airline industry badly, and is expected to result in major cut in air carriers' revenues and global traffic.
As per its initial assessment of the impact of COVID-19, the International Air Transport Association (IATA) estimates a potential 13 percent full-year loss of passenger demand for carriers in the Asia-Pacific region.
Considering that growth for the region's airlines was forecast to be 4.8 percent, the net impact will be an 8.2 percent full-year contraction compared to 2019 demand levels. That would translate into a $27.8 billion revenue loss in 2020 for carriers in the Asia-Pacific region, according to IATA.
Carriers registered in China will be hit the worst, with $12.8 billion lost in the China domestic market alone.
Carriers outside Asia-Pacific are forecast to bear a revenue loss of $1.5 billion, assuming the loss of demand is limited to markets linked to China. This would bring total global lost revenue to $29.3 billion and represent a 4.7 percent hit to global demand.
In addition to huge financial losses, it will be the first decline in demand for air travel in more than a decade.
The COVID-19 death toll in China has crossed 2200, and the number of confirmed cases of infection rose to more than 76,000.
Several Commercial carriers in Europe, Asia and North America canceled flights to and from China over Coronavirus concerns. They include British Airways, American Airlines, Lufthansa, Austrian Airlines, Air Canada, United Airlines, Delta, Cathay Pacific, Air India, Finnair, Seoul Air and Hong Kong airlines.
The Chinese government has imposed travel restrictions on millions of its citizens to prevent the spread of the virus nationally and globally. All domestic and international tour packages have been suspended.
The estimated impact of the COVID-19 outbreak on airlines from other regions would be larger if it spreads more widely to Asia-Pacific markets, according to IATA.
"The sharp downturn in demand as a result of COVID-19 will have a financial impact on airlines—severe for those particularly exposed to the China market," said Alexandre de Juniac, IATA's Director General and CEO.
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