International Airlines Group has warned that it faces a loss of €3 billion for 2021, but said that there was “a significant recovery underway”.

The group posted an operating loss before exceptional items of  €485 million for the third quarter of 2021, compared to  €1.3 billion for the same period in 2020.

Passenger capacity for the third quarter was at 43.4 per cent of 2019 levels, up from 21.9 per cent in the second quarter, and IAG is currently planning for fourth quarter capacity levels of around 60 per cent, as travel restrictions continue to ease.

The group’s CEO Luis Gallego said that the reopening of the transatlantic travel corridor from Monday November 8 “is a pivotal moment for our industry”, adding that member airline British Airways was serving more US destinations than any transatlantic carrier.

“Longhaul traffic has been a significant driver of revenue, with bookings recovering faster than shorthaul as we head into the winter,” said Gallego.

“Premium leisure is performing strongly at both Iberia and British Airways and there are early signs of a recovery in business travel.”

Gallego also highlighted three recent “initiatives” including the ongoing efforts to restructure the group’s short-haul operations at Gatwick, Aer Lingus’ launch of transatlantic flights from Manchester, and Vueling’s expansion at Paris Orly.

BA recently announced plans to bring four of its A380 superjumbos back into service, as part of what the carrier said was its ‘biggest schedule since March 2020’, including serving 23 US airports from Heathrow from December.

British Airways to operate A380 flights in November

“I would like to thank our people, who have played such a central role in all that we have achieved in the face of the most challenging time for the industry,” said Gallego.

“There’s a significant recovery underway and our teams across the Group are working hard to capture every opportunity. We continue to capitalise on surges in bookings when travel restrictions are lifted.

“All our airlines have shown improvements with the Group’s operating loss more than halved compared to previous quarters. In Q3, our operating cash flow was positive for the first time since the start of the pandemic and our liquidity is higher than ever, reaching €12.1 billion on a pro forma basis at the end of October.