Airlines lose at least R$21.4 billion in the first year of the pandemic

The first year of the Covid-19 pandemic represented the biggest crisis ever faced by the airline industry, according to businesspeople interviewed by CNN.

A survey carried out by CNN this Thursday (16), based on data from the National Transport Confederation (CNT) and the Brazilian Airlines Association (ABEAR), shows that airlines have failed to collect at least R$21 .4 billion from ticket sales in 2020, the first year of the new coronavirus pandemic.

Data from the CNT Panel indicate that 47 million Brazilians boarded domestic flights during the first year of the pandemic. In 2019, before the start of the health crisis, 104 million people were transported on national flights.

CNN also obtained, through Abear, information that the average domestic air fare in 2020 in the country was R$376.29.

For the economist at Fundação Getúlio Vargas, Joelson Sampaio, the financial loss recorded by the airline industry may have been even greater in 2020, when other variables are taken into account, such as the rising price of gasoline and high logistics costs.

“The damage to airlines was very significant in the first year of the pandemic. And I can say that this number could have been even higher, if we consider other indicators such as the increase in fuel and other fixed costs in logistics. The transport sector suffered a lot due to the restriction of mobility caused by the coronavirus, especially the air, which has a very challenging storekeeper”

The country’s leading airlines claim that ‘the Covid-19 pandemic represents the biggest crisis facing the global airline industry’. The sales and marketing director of LATAM Brasil, Diogo Elias, told CNN that, at the height of the health crisis, the company operated only 5% of all its flights. Azul Linhas Aéreas, on the other hand, detected a 53% drop in net revenue in 2020, when compared to the previous year.

In absolute terms, the company had a net profit of BRL 5,088.7 million in the first year of the pandemic, while the figure reached BRL 10,907.9 million in 2019. The company Gol Linhas Aéreas will not comment.

Complementary data from the Institute of Geography and Statistics (IBGE), released last week, show that the Covid-19 pandemic halved the air transport of passengers at Brazilian airports in 2020. The reduction in travelers was 53%, in comparison with the previous year.

Only 175 cities in the country had regular passenger or cargo flights, which corresponds to just 3.1% of the 5,570 Brazilian municipalities. Of these, 46 had at least one regular passenger flight per month in 2020.