Qatar Airways CEO Akbar Al Baker seems less-than-optimistic for the airline sector as he expects more bailouts and bankruptcies in the near future.
“The worst is not behind any airline, not only Qatar Airways,” Al Baker said in an interview with CNBC. “There will soon be other rescues in Europe, there will be other bankruptcies around the world.”
And with the collapse of more airlines, Qatar Airways chief also anticipates an increase in monopolies, a damaging situation for passengers. “I think that there will be more reduction in capacity, which in a way is also not good for the traveling public because then it will give a monopolistic situation to certain airlines that exactly wanted this to happen,” Al Baker warned.
In September 2020, Qatar Airways reported a historical $1.92 billion net loss for the fiscal year 2019-2020, mostly blamed on the economic downturn of the COVID-19 pandemic since March 2020, as well as Qatar’s diplomatic crisis ongoing since 2017. The airline issued 730 million shares to the government after receiving $2 billion in state aid to help alleviate the loss.
Al Baker expects the losses to continue as demand stagnates and flight restrictions remain in place. “All the countries of the world depend on their national carrier to serve the economic interests of the country, so it is absolutely essential that governments support the airlines,” he added.
The International Air Transport Association (IATA) recently reiterated that it did not anticipate a return of international air travel to pre-pandemic levels before 2024. But for the Group CEO of Qatar Airways, the situation could be even direr. “I think that if this pandemic spreads further into the near future, that the recovery could be even beyond 2024,” Al Baker concluded.