Global airlines biz to lose $5.6 b in 2010, says IATA

In 2009, IATA maintained its forecast of US$11 billion net loss for the industry. “The world’s airlines will lose US$11.0 billion in 2009. Between 2000 and 2009, airlines lost US$49.1 billion, which is an average of US$5.0 billion per year,” said IATA Director General & CEO Giovanni Bisignani.

The forecast are as follows:

Revenues: Industry revenues are expected to rise by US$22 billion (4.9 per cent) to US$478 billion in 2010. However, revenues remain US$57 billion (-11 per cent) below the peak of US$535 billion in 2008 and US$30 billion below 2007 when passenger traffic was at similar levels to what is expected in 2010.

Passenger Demand:  Following a decline of 4.1 per cent in 2009, passenger traffic is expected to grow by 4.5 per cent in 2010. A total of 2.28 billion people are expected to fly in 2010, bringing total passenger numbers back in line with the peak recorded in 2007, said IATA.

Cargo Demand: Cargo demand is expected to grow by 7 per cent to 37.7 million tonnes in 2010 (stronger than the previously forecast 5 per cent in September), following a 13 per cent decline in 2009. Total freight volumes will remain 10 per cent below the 41.8 million tonne peak recorded in 2007.

Yields: In 2009, passenger and cargo yields plummeted by 12 per cent and 15 per cent respectively. Cargo yields are expected to improve by 0.9 per cent in 2010. But passenger yields are not expected to improve from their extraordinary low level. This is being driven by two factors: excess capacity in the market and reduced corporate travel budgets.

Fuel: An average oil price of US$75.0 per barrel (Brent) is expected in 2010, up considerably from the US$61.8 average expected for 2009. As a percentage of operating costs, fuel will be 26 per cent in 2010, considerably lower than the 32 per cent of operating costs that fuel comprised in 2008.

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