State aid to airlines now exceeds $225bn

Government financial aid to airlines now exceeds $225 billion worldwide but almost $100 billion more will be needed, according to Iata.

Airline association Iata estimates carriers will need support worth up to £95 billion to survive this year, double the amount of aid it forecast would be required in December.

Iata director general Alexandre de Juniac described the past 12 months as “nothing less than catastrophic” for airlines

He reported passenger demand had fallen to the level of 1998 and revenue to the level of 1993.

De Juniac said: “Demand fell through the floor. Before the crisis we had almost 30,000 unique international routes between airports. Now we have about 12,000 and the density of those connections has become much thinner.

“Before the crisis the average route was served by about 43 flights per month. Now it’s around 20 flights per month – not even daily.”

He noted: “Domestic travel did better. The number of routes being served is basically unchanged, but we went from an average of almost 90 flights per route per month to 66.”

De Juniac insisted: “A viable air transport sector will be critical to the recovery.

“Governments realise that and have provided direct cash infusions and measures such as tax relief and loan guarantees to preserve the sector. In total, this is valued at over $225 billion.

“We would have seen huge bankruptcies had governments not stepped up with relief.”

But he argued: “This crisis is not over. We need continued relief measures, particularly those that do not increase the debt burden”.

He also called for stimulus measures from governments, saying: “We have seen some plans by governments to subsidise tickets, routes, domestic journeys. I urge governments to consider [more] stimulus measures.”

De Juniac will stand down as Iata director general at the end of March, to be replaced by Willie Walsh, former chief executive of International Airlines Group (IAG).

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