Cautious forecast for airline profitability improvements

written by australianaviation.com.au | October 19, 2012
photo - Rob Finlayson

IATA has forecast better profitability for the world’s airlines, revising its June 2012 prediction of US$3 billion to now US$4.1 billion for this year.

A cautious Tony Tyler, director-general and CEO of IATA, said while profitability looks to be improving, “we should not get too excited”, describing the expected 0.5 per cent profit margins as “anaemic”.

2013 profit performance is expected to improve further, with US$7.5 billion forecast (equating to a 1.1 per cent margin), supported by expected lower oil prices, faster growth and upward GDP forecasts.  The profit is still a long way off the US$19.2 billion in profits generated by IATA member airlines in 2010.

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Tyler said joint ventures in longhaul markets were “starting to make a difference”, but there was “still a long way to go before ‘normal’ profits are earned”.

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