THE global airline industry is expected to halve its net losses to $5.6 billion in 2010 from $11 billion this year, with carriers in Asia-Pacific likely to experience a “dramatic improvement” as they improve their financial bottomline.
But despite this favourable outlook, the International Air Transport Association (IATA) has predicted that “tough times” would continue as it revised its 2010 forecast of losses from $3.8 billion to $5.6 billion, with 14 airlines shutting shop this year. “The worst is likely behind us.... The world’s airlines will lose $11 billion in 2009. We are ending an annus horribilis,” director general and CEO Giovanni Bisignani said at the IATA global media briefing here on Tuesday.
Asia-Pacific carriers are expected to post losses of $700 million next year. “Compared to losses of $3.4 billion in 2009, this region is showing the most dramatic improvement. This is driven by a recovery in some of the region’s economies,” he said.
“The economies of China, India and Brazil have started showing very good growth,” said IATA’s chief economist Brian Pierce said, but added that high fuel prices were “squeezing the cash flow” for the global airline industry. He said the Asia-Pacific carriers are expected to show the “biggest reduction in average losses” as an upturn in yields and traffic was already being reported by the airlines of the region.
Mr Bisignani expressed disappointment at some countries and airports charging exorbitant user charges. He was particularly critical of India and expressed frustration at the fact that passengers are being penalised now for rebuilding and modernisation of airports which future passengers would benefit from.
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