Global airline losses forecast at US$9bn

IATA has revised its airline financial forecast for 2009 to a global loss of US$9bn, nearly double the association’s March estimate of US$4,7bn. Iata also revised its loss estimate for 2008 to US$10,4bn from the previous estimate of US$8,5bn. “There is no modern precedent for today’s economic meltdown. The ground has shifted. Our industry has been shaken. This is the most difficult situation that the industry has faced. After September 11, revenues fell by 7%,” said Giovanni Bisignani, Iata director general and ceo. “Our future depends on a drastic reshaping by partners, governments and industry. We cannot bear the cost of government micro-regulation, crazy taxation and partners abusing their monopoly power.” According to Iata, recession is the most significant factor impacting the industry’s bottom line. Iata’s revised forecast sees revenues declining a record 15% (US$80bn) from US$528bn in 2008 to US$448bn in 2009. A statement released by Iata said African carriers were expected to see losses of US$500m as a result of a loss of market share combined with the impact of the recession. Iata predicts that Asia-Pacific carriers will post the largest loss at US$3,3bn. Bisignani further noted the risks and challenges for airlines that included fuel bills, efficiency gains, stronger cash reserves, careful capacity management and strong partnerships. The industry crisis is making liberalisation even more critical. “We cannot manage in these unprecedented times with one hand tied behind our back. Airlines need the same commercial freedoms that every other industry takes for granted – access to global markets and capital,” said Bisignani. Jeanette Phillips (jeanettep@nowmedia.co.za)