Tue, Jun 09, 2009
Focus On Global Air Travel Crisis
More than 500 leaders from the
airline industry worldwide are meeting in Kuala Lumpur Monday and
Tuesday for the annual meeting of the International Air Transport
Association, with an eye towards keeping their industry going
during a global recession.
The organization called for a major resizing and reshaping of
the entire air transport value structure, as airlines battle the
ongoing global economic crisis. Airlines are expected to post
losses of $9 billion this year with an unprecedented 15% revenue
drop that will see industry revenues shrink by $80 billion to $448
billion, according to the IATA website.
Giovanni Bisignani, IATA’s Director General and CEO, said
in his "State of the Industry" address "I am a realist and I
don’t see facts to support optimism. The industry is in
survival mode. Whether this crisis is long or short, the world is
changing. Travel budgets have been slashed and consumers will need
to reduce their debt. It will not be business as usual in the
post-crisis world. Governments, partners and airlines must use this
crisis as an opportunity to build a stronger industry. That means
resizing and reshaping."
Bisignani also urged a resizing and
reshaping of the relationship between airlines and governments.
“Our relationship with governments must move from punitive
micro-regulation to joint problem solving,” said Bisignani
who cited four areas for enhanced cooperation. They include making
aviation greener and addressing emissions issues, better security,
improving efficiency by reducing delays, and saving jobs and
stimulating the economy.
Bisignani also called for government intervention to prevent
volatile fuel prices from crippling the industry. The industry fuel
bill is forecast to fall by $59 billion to $106 billion in 2009,
which will account for 23% of operating costs.
“The risk that we have seen in recent weeks is that even
the slightest glimmer of economic hope sends oil prices higher.
Greedy speculation must not hold the global economy hostage.
Failure to act by governments would be irresponsible,” he
said.
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