HomeNewsLosses Mount for IAG as Forecast is For Subdued Return

Losses Mount for IAG as Forecast is For Subdued Return

IAG is only expecting a partial reopening of travel after losses continue to mount in the first quarter of 2021.

The parent group of Aer Lingus, British Airways and Iberia will operate at 25 per cent of its 2019 capacity for Q2 after an adjusted operating loss of €1.135 billion for the first three months of 2021.

In February, IAG reported a net loss of €6.9 billion after tax for 2020 – the biggest in its history – compared to a net profit of €1.7 billion in 2019. It also disclosed an operating loss of €7.4 billion in 2020 compared with a profit of €2.6 billion in 2019.

The continued impact of the pandemic and associated restrictions worldwide meant its airlines operated a combined passenger schedule of 19.6 per cent in the first quarter of 2021 compared to the same period in 2019. Conversely, the group operated 1,306 extra cargo flights leading to record cargo revenue for the quarter.

Aer Lingus capacity continues to be driven by cargo needs, with flights operating regularly to New York, JFK, Chicago and Boston with very low passenger load factors. However, according to IAG the domestic route between London Heathrow and Belfast “performed well with sustained business traveller demand.”

Return to Flying

IAG expects it will take “at least” until 2023 for passenger demand to reach 2019 levels.

“We’re absolutely confident that a safe re-start to travel can happen as shown by the scientific data,” said IAG chief executive Luis Gallego in a statement. “We’re ready to fly, but government action is needed.”

He identified four”key measure” as being necessary for the resumption of normal services:

  • Travel corridors without restrictions between countries with successful vaccination rollouts and effective testing such us the UK and the US. 
  • Affordable, simple and proportionate testing to replace quarantine and costly, multi-layered testing. 
  • Well-staffed borders using contactless technology including e-gates to ensure a safe, smooth flow of people and frictionless travel. 
  • Digital passes for testing and vaccination documentation to facilitate international travel. 

“These measures will enable a safe re-opening of our skies,” Gallego added.

“Travel underpins a global industry that supports 13 million jobs in Europe alone. There’s a high level of pent-up demand and aviation will play a critical role in reconnecting people and getting economies back up and running again.” 

 

 

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