The global airline industry faces a potential financial hit from coronavirus of as much as $133 billion.
The worst case forecast came from Iata on the day that Flybe failed.
The airline industry body yesterday calculated that airlines could lose $63 billion to $113 billion in passenger revenue against a previous estimate last month of $29.3 billion of coronavirus had been contained in China.
The virus has spread to more than 80 countries since then and forward bookings have been severely impacted on routes beyond China.
Airline share prices have fallen nearly 25% since the outbreak began, some 21 percentage points greater than the decline that occurred at a similar point during the SARS crisis of 2003.
“To a large extent, this fall already prices in a shock to industry revenues much greater than our previous analysis,” Iata said.
Even a limited spread of the virus would see a fall in demand translating to an 11% worldwide passenger revenue loss equal to $63 billion.
China would account for some $22 billion of the total while markets associated with Asia, including China, would account for $47 billion.
The worst case scenario suggests a 19% loss in worldwide passenger revenues, which equates to $113 billion.
Countries in Europe – including the UK, France, Italy, Germany, Spain, Switzerland, Sweden, Norway and Netherlands – could suffer a 24% dive in passengers, cutting revenues by $37.3 billion.
“Financially, that would be on a scale equivalent to what the industry experienced in the [2008] global financial crisis,” Iata warned.
Director general and chief executive Alexandre de Juniac said: “The turn of events as a result of Covid-19 is almost without precedent.
“In little over two months, the industry’s prospects in much of the world have taken a dramatic turn for the worse.
“It is unclear how the virus will develop, but whether we see the impact contained to a few markets and a $63 billion revenue loss, or a broader impact leading to a $113 billion loss of revenue, this is a crisis.
“Many airlines are cutting capacity and taking emergency measures to reduce costs.
“Governments must take note. Airlines are doing their best to stay afloat as they perform the vital task of linking the world’s economies.
“As governments look to stimulus measures, the airline industry will need consideration for relief on taxes, charges and slot allocation. These are extraordinary times.”
