Home ECONOMY AFRAA Assessment Reveals Africa’s Airline Industry Lost $10.21 Billion in 2020

AFRAA Assessment Reveals Africa’s Airline Industry Lost $10.21 Billion in 2020

by biasharadigest

The African Airlines Association (AFRAA) has published its impact assessment analysis, revealing that the African airline industry recorded a passenger revenue loss of close to $10.21 billion for the year 2020.

AFRAA; Scheduled Passengers Carried by African Airlines

According to AFRAA, the number of scheduled passengers carried by African airlines recorded a year-on-year decline of 63.7%, from 95 million in 2019 to 34.7 million in 2020.

From the end of March, AFRAA reports that most airlines grounded their aircraft, resulting in a massive fall in seat and revenue per kilometre of 85% and 94%, respectively, in April. The fall in traffic continued until June, before reversing after borders started opening. 

AFRAA Assessment on Passenger Revenue Loss

The AFRAA survey also shows that African airlines carried more domestic traffic in 2020, making 43% of their total traffic. International traffic represented 57%, broken down into 19% of Intra-African and 38% of intercontinental passengers.

Northern Africa led in passenger numbers, representing 36.6% of the total continental traffic, followed by Eastern Africa with a share of 22.2%. Domestic and Intra-African traffic remained dominant in this region, both representing 70% of the traffic in 2020.

Southern Africa suffered a 63.6% drop in traffic due to COVID-19, with the region having only 21% of the continental traffic. Still, its share of the domestic market grew to 77% in the last quarter of 2020, from 66% before the coronavirus pandemic.

Western and Central African regions both represented 19.7% of the traffic in Africa.

AFRAA survey shows that Johannesburg and Cairo were the busiest airports as per landings and take-offs, with Jomo Kenyatta International Airport leading ranking by freight traffic. It handled close to 330,000 tonnes in 2020, followed by Cairo’s 280,000 tonnes.

Among all 54 African countries, 13 have direct flights to more than 20 African countries. Kenya and Ethiopia lead with 30 direct flights and more to other countries within Africa.

Although AFRAA data shows that the loss is expected to reduce to about $8.35 billion, airlines will continue to lose money in 2021.

According to data from IATA (International Air Transport Association), the aviation industry contributes an estimated $55.8 billion to Africa’s economy, contributing 2.6% to GDP and creating close to 6.2 million job opportunities.

Traffic recovery for Jan-May 2021 was 37% of the 2019 level. In May alone, traffic declined by 62.2% compared to the same month in 2019. Similarly, capacity declined 53.1% compared to May 2019. Mauritius remains the most impacted hub, reducing 98% of possible connections to/from African airports compared to March 2020. Connectivity at Nairobi JKIA decreased mainly as a result of schedule adjustments and frequency reduction of Kenya Airways.

Demand for domestic passenger travel continues to out-perform intra-Africa and intercontinental at 61.5% compared to 23.1% for intra-Africa and 15.1% for intercontinental. In terms of capacity seats offered, domestic, intra-Africa and intercontinental account for 47.7%, 27.2% and 25.1%, respectively.

In Q1 2021 alone, airlines lost $2.6 billion, and the estimate for Q2 is $2.5 billion.

See Also:

COVID-19 Continues to Take a Toll on African Airlines

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