New IATA forecast predicts ongoing losses
Airlines will lose $5.6bn in 2010, the International Air Transport association said today (December 15).
This is a significant increase on the $3.8bn loss previously forecast by the airlines' association.
IATA is still predicting an $11bn net global loss for carriers this year.
But despite forecasting continuing losses for the aviation industry, Giovanni Bisignani, IATA's director general and ceo, said the "worst is likely behind us".
IATA said in its forecast for 2010 that industry revenue was likely to rise by 4.9% from $22bn to $478bn compared to this year.
At the same time airlines are expected to drive down non-fuel costs by 1.3%.
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Giovanni Bisignani: more losses |
But IATA predicted that fuel costs and yields would be a "continuing disaster".
It said that it expected the average price of fuel to rise to $75 per barrel in 2010 compared with a so far average price in 2009 of $61.8.
This would make fuel 26% of a carrier's operating costs, lower than the 32% in 2008 but twice as high as 2001-2002.
On yields, IATA said those for passengers had dropped by 12% in 2009 and are "not expected to improve from their extraordinary low level".
But with 1300 new aircraft due to be delivered in 2010, IATA said 2.8% would be added to global capacity which would put more pressure on yields.
"On top of this, corporate travel buyers have adjusted their budgets to reflect lower premium fare levels," IATA said.
But on a rare optimistic note, IATA said it predicted passenger demand to rise in 2010 after a 4.1% drop this year.
It said it expected a 4.9% growth, higher than the 3.2% originally forecast, with 2.28bn people flying during the year
Mr Bisignani said: "The world's airlines will lose $11bn in 2009. We are ending an Annus Horribilis that brings to a close the 10 challenging years of an aviation Decennis Horribilis.
"Between 2000 and 2009, airlines lost $49.1bn, which is an average of $5bn per year.
"The worst is likely behind us. For 2010, some key statistics are moving in the right direction.
"Demand will likely continue to improve and airlines are expected to drive down non-fuel unit costs by 1.3%.
"But fuel costs are rising and yields are a continuing disaster. Airlines will remain firmly in the red in 2010 with $5.6bn in losses."
www.iata.org