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By Sarah Young
LONDON, April 7 (Reuters) - Global airlines warned that 25
million jobs across the world could be at risk from the
coronavirus travel downturn and the industry's representative
body said airline finances were so fragile they could not afford
to refund customers.
The International Air Transport Association (IATA) has held
a series of weekly news conferences, issuing increasingly
desperate messages about the state of airline industry, and
urging governments to help carriers.
In its latest warning, IATA whose members include the likes
of Lufthansa and British Airways parent IAG
said global air travel slumped by 70% at the beginning of the
second quarter, and its Director General Alexandre De Juniac
said airlines could not afford to issue refunds. He said
customers should accept vouchers.
"The key element for us is to avoid running out of cash so
refunding the cancelled ticket for us is almost unbearable
financially speaking," De Juniac told reporters on Tuesday.
IATA highlighted the loss of jobs and the impact on the
world economy if governments let airlines collapse.
Three months of severe travel restrictions plus lower
traffic over 2020 could put 25 million jobs at risk, IATA
warned, adding that about a third of 2.7 million direct jobs in
the airline sector had either been lost or were furloughed.
Airlines are burning through their cash reserves as they try
to stay afloat, IATA said, and providing refunds for cancelled
flights, as rules in many parts of the world such as EU261 in
the European Union, require them to do, was not possible.
Consumer groups are angry at airlines for ignoring those
rules and say hard-up passengers need the cash just as much as
the airlines.
IATA said about $35 billion of tickets were due for refund
at the end of the second quarter, and vouchers or a delayed
refund was all airlines could offer. IATA has approached
governments to ask them not to force airlines to provide cash
refunds.
But the U.S. Transportation Department has told airlines
they must refund tickets for flights that they cancel, or make a
significant schedule change that passengers do not accept,
following a rising number of consumer complaints and inquiries.
In the United States, a passenger filed a class-action
lawsuit on Monday against United Airlines for refusing to pay a
refund after his family’s flight was cancelled.
Separately on Tuesday, an environmental group called Stay
Grounded published an open letter signed by 250 environmental
groups and charities from across Europe calling on governments
to attach climate and labour conditions to any airline bailouts.
IATA has been asking governments for a reduction of charges
and taxes to help its members, which represent 82% of global air
traffic, survive, and for funds to help restart routes in
future.
It said on Tuesday that European countries had agreed to
defer air traffic control charges totalling some 1.1 billion
euros ($1.2 billion) from February to May.
($1 = 0.9164 euros)
(Reporting by Tim Hepher, Sarah Young and Laurence Frost
Editing by John Stonestreet and David Holmes)
