Carriers lost US$1.7 billion in revenue due to ash fall

22 Apr 2010

The six-day Icelandic volcano crisis cost the airlines US$1.7 billion in lost revenue, estimates the International Air Transport Association (IATA).

When the disruptions were greatest during the three-day period from April 17 to 19, 2010, lost revenues reached US$400 million per day.

“At the worst, the crisis impacted 29 percent of global aviation and affected 1.2 million passengers a day,” said Giovanni Bisignani, IATA’s director general and CEO. “The scale of the crisis eclipsed 9/11 when US airspace was closed for three days.”

Flight groundings may have resulted in some savings, but taking care of stranded passengers incurred costs as well.

Bisignani pointed out that the industry already lost US$9.4 billion last year and was forecast to lose a further US$2.8 billion this year. The volcanic ashfall, halting operations on such a wide, was the last thing it needed.

Together with assessing the financial damage, the aviation industry had to find ways to mitigate the impact, Bisignani said. He cited some players such as London Heathrow and Dubai International Airport who had taken proactive steps and waived parking fees and not charged for repositioning of flights.

Bisignani stressed that governments now had to step in and help airlines recover from the disruption. He made four specific requests for regulatory relief:

• Relax airport slot rules (regarding take-off and landing slot allocation – use it or lose it) to reflect the extra-ordinary nature of the crisis

• Lift restrictions on night flights so airlines could get stranded passengers back home as soon as possible

• Address European passenger rights regulations that take no consideration of acts of God or extraordinary situations and hold airlines responsibile to pay for hotels, meals and telephones. The European Commission has help ease the burden

• Governments to compensate airlines for lost revenues just as after 9/11, the US government and EC provided similar assistance

For more details, go to

Margie T Logarta

Loading comments...
BTUK October 2018 issue
BTUK October 2018 issue
Be up-to-date
Magazine Subscription
To see our latest subscription offers for Business Traveller editions worldwide, click on the Subscribe & Save link below