Global airlines are adding capacity at a faster rate than international travel demand growth in August and September, placing further pressure on cash flows and underscoring the urgent need for continued relief measures by governments.
Closed borders, imposed quarantines and uncoordinated governments policies are among the major barriers to travel, making it more difficult for airlines to plan ahead for flight schedules, Brian Pearce, the chief economist of the International Transport Association (Iata) told reporters on Tuesday.
The gap between bookings and airline schedules is "widening and that gap unfortunately means airlines are probably burning cash as a result of the potentially disappointing slow improvements in demand," Mr Pearce said. "That leaves airline finances in a relatively fragile situation as governments are starting to pull back on the support given."
In July this year, global airlines recorded an 80 per cent drop in passenger travel demand compared to July 2019 while load factors, a measure of how well a carrier is filling available seats, fell to a record low of 58 per cent.
Middle East airlines posted a 93.3 per cent annual traffic decline in July, compared with a 96.1 per cent demand drop in June, Iata said in its monthly report on Tuesday. Capacity tumbled 85.6 per cent and load factor fell 43.4 percentage points to 38 per cent.
"Borders are largely closed and governments' management of travel restrictions is so unpredictable and uncoordinated that people are still not flying," Alexandre de Juniac, director-general of Iata said on an online conference call.
"For the industry this is immensely frustrating, it is also frustrating for travellers...and it is tragic for the growing numbers of the unemployed whose livelihoods are being destroyed," he said.
Airlines worldwide are facing a loss of $84.3 billion (Dh309.5bn) this year, a 50 per cent cut in revenues and high fixed costs for aircraft and labour as the Covid-19 pandemic decimates air travel demand.
With four in five air travellers staying at home, governments reopening then closing borders or removing then re-imposing quarantines, consumers do not have confidence to make travel plans nor airlines to rebuild their schedules, Iata said.
While business confidence is more positive following the reopening of economies, the challenge is that consumers are feeling less confident as unemployment rates rise, which is reflecting in travel patterns, Mr Pearce said.
"The number of premium tickets are actually growing at a similar pace to the growth of economy tickets ... there might be some evidence that we're seeing some business travel albeit at relatively low levels," he said.
Iata is calling on governments to reopen borders, develop testing that reduces the risk of importing the virus and continue providing relief measures for airlines without increasing their debt burden, Mr de Juniac said. Iata advocates for Covid-19 testing that is reliable, scaleable, adaptable, more comfortable for travellers, and not reliant on complicated machinery or highly-trained personnel.
Governments have had an "uneven" approach to financial relief packages, with US and North American airlines well supported while those in major emerging markets such as Africa and Latin America have seen very little support, Mr Pearce said.
Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law
Wicked: For Good
Director: Jon M Chu
Starring: Ariana Grande, Cynthia Erivo, Jonathan Bailey, Jeff Goldblum, Michelle Yeoh, Ethan Slater
Rating: 4/5
Ferrari 12Cilindri specs
Engine: naturally aspirated 6.5-liter V12
Power: 819hp
Torque: 678Nm at 7,250rpm
Price: From Dh1,700,000
Available: Now
if you go
The flights
Air France offer flights from Dubai and Abu Dhabi to Cayenne, connecting in Paris from Dh7,300.
The tour
Cox & Kings (coxandkings.com) has a 14-night Hidden Guianas tour of Guyana, Suriname and French Guiana. It includes accommodation, domestic flights, transfers, a local tour manager and guided sightseeing. Contact for price.
What is a robo-adviser?
Robo-advisers use an online sign-up process to gauge an investor’s risk tolerance by feeding information such as their age, income, saving goals and investment history into an algorithm, which then assigns them an investment portfolio, ranging from more conservative to higher risk ones.
These portfolios are made up of exchange traded funds (ETFs) with exposure to indices such as US and global equities, fixed-income products like bonds, though exposure to real estate, commodity ETFs or gold is also possible.
Investing in ETFs allows robo-advisers to offer fees far lower than traditional investments, such as actively managed mutual funds bought through a bank or broker. Investors can buy ETFs directly via a brokerage, but with robo-advisers they benefit from investment portfolios matched to their risk tolerance as well as being user friendly.
Many robo-advisers charge what are called wrap fees, meaning there are no additional fees such as subscription or withdrawal fees, success fees or fees for rebalancing.
The specs
Engine: 1.6-litre 4-cyl turbo and dual electric motors
Power: 300hp at 6,000rpm
Torque: 520Nm at 1,500-3,000rpm
Transmission: 8-speed auto
Fuel consumption: 8.0L/100km
Price: from Dh199,900
On sale: now
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Timeline
2012-2015
The company offers payments/bribes to win key contracts in the Middle East
May 2017
The UK SFO officially opens investigation into Petrofac’s use of agents, corruption, and potential bribery to secure contracts
September 2021
Petrofac pleads guilty to seven counts of failing to prevent bribery under the UK Bribery Act
October 2021
Court fines Petrofac £77 million for bribery. Former executive receives a two-year suspended sentence
December 2024
Petrofac enters into comprehensive restructuring to strengthen the financial position of the group
May 2025
The High Court of England and Wales approves the company’s restructuring plan
July 2025
The Court of Appeal issues a judgment challenging parts of the restructuring plan
August 2025
Petrofac issues a business update to execute the restructuring and confirms it will appeal the Court of Appeal decision
October 2025
Petrofac loses a major TenneT offshore wind contract worth €13 billion. Holding company files for administration in the UK. Petrofac delisted from the London Stock Exchange
November 2025
180 Petrofac employees laid off in the UAE
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Thor: Ragnarok
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- A new “core protection” for refugees moving from permanent to a more basic, temporary protection
- Shortened leave to remain - refugees will receive 30 months instead of five years
- A longer path to settlement with no indefinite settled status until a refugee has spent 20 years in Britain
- To encourage refugees to integrate the government will encourage them to out of the core protection route wherever possible.
- Under core protection there will be no automatic right to family reunion
- Refugees will have a reduced right to public funds
england euro squad
Goalkeepers: Dean Henderson (Man Utd), Sam Johnstone (West Brom), Jordan Pickford (Everton)
Defenders: John Stones (Man City), Luke Shaw (Man Utd), Harry Maguire (Man Utd), Trent Alexander-Arnold (Liverpool), Kyle Walker (Man City), Tyrone Mings (Aston Villa), Reece James (Chelsea), Conor Coady (Wolves), Ben Chilwell (Chelsea), Kieran Trippier (Atletico Madrid)
Midfielders: Mason Mount (Chelsea), Declan Rice (West Ham), Jordan Henderson (Liverpool), Jude Bellingham (Borussia Dortmund), Kalvin Phillips (Leeds)
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Blackpink World Tour [Born Pink] In Cinemas
Starring: Rose, Jisoo, Jennie, Lisa
Directors: Min Geun, Oh Yoon-Dong
Rating: 3/5
RACECARD
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The specs: 2018 Volkswagen Teramont
Price, base / as tested Dh137,000 / Dh189,950
Engine 3.6-litre V6
Gearbox Eight-speed automatic
Power 280hp @ 6,200rpm
Torque 360Nm @ 2,750rpm
Fuel economy, combined 11.7L / 100km
