Sweeping travel bans will cost airlines around €230 billion this year, more than twice the original estimate of Covid-19 revenue losses.
Irish carriers such as Aer Lingus, Ryanair and Stobart Air are shutting operations as air travel grinds to a halt in the face of tough restrictions to combat coronavirus.
Industry group, the International Air Travel Association (IATA), calculated on Tuesday that the pandemic would cost airlines around the world $252 billion (€233 billion) in lost ticket sales.
The association said earlier this month that coronavirus would knock $113 billion off carriers’ revenues.
Restrictions
However, the IATA said on Tuesday that this was before countries introduced the sweeping travel restrictions now in place that will ground passenger fleets.
The organisation bases its new estimate on three months’ travel restrictions followed by a gradual recovery in the world’s economy later this year.
“The airline industry faces its gravest crisis,” said IATA chief executive, Alexandre de Juniac.
He added that his organisation believed airlines would need at least $200 billion to get through the crisis.
“Some governments have already stepped forward, but many more need to follow suit,” Mr de Juniac added.
His warning came after Ryanair, Europe’s largest budget airline, told customers it had effectively written off the next two months, while European air traffic management body Eurocontrol said volumes on Monday were down more than 75 per cent from the same day last year.
Mr De Juniac, a former Air France-KLM boss, brushed aside a growing debate about whether relief for airlines should come with strings attached, such as new commitments on climate goals.
But he said the airline industry would continue efforts already under way to curb emissions once the crisis recedes.
“We are in an emergency situation. It’s no time for requirements. I’m sorry for that. We need a full speed massive rescue package now,” de Juniac said.
With airlines at the front of bailout queues, green advocates fear climate action may lose momentum.
Bailouts
In the United States, Republicans have opposed providing bailouts to passenger and cargo carriers, proposing help in the form of $58 billion in loans and saying the government could demand stock, options or other equity in return.
IATA, which groups some 280 airlines including most of the world’s largest network carriers, said signs of a deep recession could delay a recovery in airline travel - in contrast with the fast rebound seen after previous epidemics.
That could mean "more of a U-shaped than V-shaped recovery," chief economist Brian Pearce said, referring in the latter instance to the shape of the graph of air travel indicators seen after the SARS outbreak in 2003.
IATA says 2.7 million jobs are supported by the airline industry, with tens of thousands already being furloughed.
“There are a very large number of airlines that are more or less breaking even and ... facing losses. Those airlines are very fragile,” Mr Pearce said.
- Additonal reporting Reuters