The Department of Transportation extended the “rental holiday” for airport concessionaires until end of April to help the aviation industry amid the COVID-19 pandemic.
Transportation Secretary Arthur Tugade instructed airport authorities to extend the “rental holiday” for airport concessionaires to cushion the economic impact of the pandemic on the aviation sector and its stakeholders.
The International Air Transport Association earlier estimated that the pandemic could cost 419,800 jobs and $3.5-billion reduction in revenues while its impact to the gross domestic product was estimated to reach $3.74 billion. It could also reduce travel demand by as many as 21.87 million passengers.
The Air Carriers Association of the Philippines earlier sent a letter to the Philippine government for intervention as Philippine carriers were facing “existential threat to their survival.”
ACAP requested the government to provide a credit guarantee scheme and long-term facility at attractive rates or a guaranty facility to enable airlines to restructure debt.
Philippine Airlines, Cebu Pacific, Air Asia Philippines, Cebgo and PAL Express ceased domestic operations and international flights over COVID-19.
IATA released an updated analysis on April 14 showing that the COVID-19 crisis would see airline passenger revenues drop by 55 percent to $314 billion in 2020 from a year ago. It earlier estimated $252 billion in lost revenues in a scenario with severe travel restrictions lasting three months.
“The industry’s outlook grows darker by the day. The scale of the crisis makes a sharp V-shaped recovery unlikely. Realistically, it will be a U-shaped recovery with domestic travel coming back faster than the international market. We could see more than half of passenger revenues disappear. That would be a $314 billion hit,” said IATA director-general and chief executive Alexandre de Juniac.
“Several governments have stepped up with new or expanded financial relief measures but the situation remains critical. Airlines could burn through $61 billion of cash reserves in the second quarter alone. That puts at risk 25 million jobs dependent on aviation. And without urgent relief, many airlines will not survive to lead the economic recovery,” he said.
