Airlines heading for $4 billion losses
Airline passenger numbers are on the rise but collective airline losses could exceed $4 billion this year due to high fuel costs.
IATA, releasing traffic date for the first nine months of 2004, called on all sectors of the industry to help combat rising oil prices.
Despite staff and distribution cost cuts – resulting in a three per cent reduction in non-fuel costs – IATA director general Giovanni Bisignani demanded more focus on efficiency.
Revealing that IATA carriers are on course to achieve a 14% rise in passenger carryings this year over 2003, Mr Bisignani warned: “The sad story is that despite these improvements, the bottom line is worsening with the extraordinary price of fuel.
“If current price levels persist, losses may well exceed the $3-4 billion previously forecast for 2004.
“Improving efficiency is the mantra. This applies equally to shortening air routes, operating more fuel-efficient aircraft and streamlining industry processes.
“With oil in the $50 a barrel range it is critical that our industry partners join these efforts in earnest. In particular governments, air navigation service providers and airports need to co-operate to optimise flight operations and reduce fuel consumption,” he said.
International scheduled passenger traffic for the nine months to September 2004 grew 17.7% over the same period last year, with the month of September showing a 10.9% growth year on year.
Report by Phil Davies
Phil Davies
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