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Thursday, 28 March 2024

Domestic air travel down 70%, recovery likely to be slow

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Domestic air travel down 70%, recovery likely to be slow
Domestic air travel down 70%, recovery likely to be slow

Domestic air traffic is down 70% globally and the recovery over the coming six months is likely to be slow, the industry's representative body IATA said on Tuesday.

Ciara Lee reports

More bad news for the battered airline industry.

Domestic air traffic is down 70% globally and the recovery over the next six months will likely be slow.

That's the latest assessment from the industry's representative body, IATA.

It said on Tuesday (April 21) that while domestic markets will open sooner than long-haul, the damage done to consumer confidence will undermine a quick recovery.

Across the board airlines are having to take action.

Germany's Lufthansa, which has slashed its capacity by over 95%, suspended its dividend and is sounding out financial aid with the federal government.

According to people familiar with the matter, options include a state-guaranteed loan and the government owning a stake in the company.

In the the U.S., the Treasury Department said Monday it had disbursed nearly $3 billion in initial payroll assistance to 54 smaller passenger carriers and two major airlines.

United Airlines expects to report a pre-tax loss of about $2.1 billion for the first quarter, after lockdowns smothered its growth aspirations in Latin America.

Virgin Atlantic says it will only survive if it gets financial support from the British government.

And Virgin Australia said it entered voluntary administration to recapitalise the business and emerge in a stronger financial position.

It's been hit by the drop in demand combined with its high debt load.

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