Airlines are on track to lose up to $157 billion between this year and next year, according to the International Air Transport Association (IATA) - a sharp increase over their June projection of $100 billion in losses they made in June for the same period.

The new projection includes a $118.5 billion deficit for 2020, and at least $38.7 billion for 2021, according to Reuters, which suggests that the bleak outlook "underscores challenges still facing the sector despite upbeat news on the development of COVID-19 vaccines, whose global deployment will continue throughout next year."

"The positive impact it will have on the economy and air traffic will not happen massively before mid-2021," said IATA Director General Alexandre de Juniac in a statement to Reuters.

Passenger numbers are expected to drop to 1.8 billion this year from 4.5 billion in 2019, IATA estimates, and will recover only partially to 2.8 billion next year. Passenger revenue for 2020 is expected to have plunged 69% to $191 billion.

“That’s by far the biggest shock the industry has experienced in the post-World War Two years,” IATA Chief Economist Brian Pearce said.

The forecasts assume significant re-opening of borders by the middle of next year, helped by some combination of COVID-19 testing and vaccine deployment. -Reuters

The association recommends that governments stop travel-killing quarantines and instead implement widespread testing for COVID-19.

"We are seeing states progressively coming to listen to us," said de Juniac, pointing to testing programs underway in the United States, Britain, Singapore, France, Germany, and Italy.

Recently, Qantas Airways CEO Alan Joyce said that the COVID-19 vaccine will be mandatory for anyone boarding its flights and that it will become the norm for international travel.

"We are looking at changing our terms and conditions to say, for international travelers, that we will ask people to have a vaccination before they can get on the aircraft," said Joyce, adding, "I think that’s going to be a common thing talking to my colleagues in other airlines around the globe."

De Juniac, however, is not a fan.

"It would prevent people who are refusing (the vaccine) from traveling," he said, adding "Systematic testing is even more critical to reopen borders than the vaccine."

Meanwhile, air cargo is doing extremely well during the pandemic - and will likely see global revenues rise 15% to $117.7 billion in 2020 despite a decline in volume of 11.6% to 54.2 million tons according to the IATA.

Some $173 billion in government aid has left recipients with debts that threaten to hobble future investment, it warned, and more bankruptcies are likely. Norwegian Air became the latest casualty on Nov. 18, when it filed for bankruptcy protection in Ireland. -Reuters

According to the report, the average airline can survive another 8.5 months with liquidity on hand, while some have just weeks. "I think we will get consolidation through some airline failures," says Pearce.