The Centre for Asia Pacific Aviation (CAPA) said that the coronavirus pandemic may cause many airlines to become bankrupt by the end of May this year.
The statement of CAPA comes at a time when many of the airlines across India have decreased the number of flights due to various travel restrictions imposed by the government.
The statement said, “As the impact of the coronavirus and multiple government travel reactions sweep through our world, many airlines have probably already been driven into technical bankruptcy, or are at least substantially in breach of debt covenants.”
According to CAPA, the only way in which airlines can be saved from a catastrophe is when coordinated government and industry action is taken.
It said, “Coordinated government and industry action is needed now if catastrophe is to be avoided.”
CAPA further stated that the demand is drying up in ways that are completely unprecedented. Normality is not yet on the horizon. Cash reserves are running down quickly as fleets are grounded and what flights there are operate much less than half full, CAPA added.
The Centre on Tuesday prohibited travel of passengers from Afghanistan, Philippines, Malaysia to India till March 31, 2020, to prevent the spread of Coronavirus which has become a global threat.