IATA Reverses Its Profit Projection For 2008, Now Forecasts BIG Losses | Aero-News Network
Aero-News Network
RSS icon RSS feed
podcast icon MP3 podcast
Subscribe Aero-News e-mail Newsletter Subscribe

Airborne Unlimited -- Recent Daily Episodes

Episode Date

Monday

Tuesday

Wednesday

Thursday

Friday

Airborne On ANN

Airborne 05.23.16

Airborne 05.24.16

Airborne 05.25.16

Airborne 05.26.16

Airborne 05.27.16

Airborne Hi-Def On YouTube

Airborne 05.23.16

Airborne 05.24.16

Airborne 05.25.16

Airborne 05.26.16

Airborne 05.27.16

AEA2016 LIVE Aero-TV: 04/27-0830ET, 04/28-1400ET, 04/29-1100ET

Sun 'n Fun 2016 Innovation Preview on Vimeo!

Sun 'n Fun 2016 Innovation Preview on YouTube!

Tue, Jun 03, 2008

IATA Reverses Its Profit Projection For 2008, Now Forecasts BIG Losses

Airlines Stand To Lose As Much As $6.1 Billion On Fuel This Year

It's the absolute worst-case scenario... they hope. The International Air Transport Association, whose members account for 93 percent of international traffic, projects airlines may report losses totaling $6.1 billion for 2008, as they face soaring jet fuel prices.

That projection is based on oil prices hovering close to the $135-per-barrel record reached May 22, reports Bloomberg. Prices have since dropped about $8 per barrel; IATA's official projection is for "only" a $2.3 billion loss, based on an oil price closer to $107 per barrel.

Still, even that mumber is a stunning reversal of the group's earlier projection of a $4.5 billion net industry profit. If it proves accurate, this will be the worst year for the airlines since 2003.

IATA members amassed a net profit of $5.6 billion in 2007, their first profitable year since the September 11, 2001 terrorist attacks. But CEO Giovanni Bisignani told attendees at the group's annual meeting in Istanbul, "Skyrocketing oil prices are changing everything. The situation is desperate and potentially more destructive than our recent battles with all the horsemen of the apocalypse combined."

UK-based business class airline Silverjet last week became the latest of a dozen airlines to ground its planes after running out of operating cash. Bisignani called the combination of steep fuel price increases, slowing demand and tightening global credit a "perfect storm," and the situation, "grim."

For the moment, manufacturers are putting on brave faces... while also preparing for potentially hundreds of cancellations of new plane orders. Airbus chief salesman John Leahy told the group he remains hopeful that current prices are merely a "bubble."

Bloomberg reports a unanimous consensus among attendees to call on governments to regulate airports more tightly, facilitate mergers, cut taxes, invest in new planes for state-run carriers and take steps to ensure that the cost of energy reflects its true value. IATA also warns labor unions to limit pay claims.

FMI: www.iata.org

Advertisement

More News

Aero-News: Quote Of The Day (05.30.16)

"We take great pride in Vietjet selecting the game-changing Geared Turbofan engine to power their aircraft fleet. Customers continuously recognize that this engine represents the p>[...]

Airborne 05.27.16: More MH370 Debris, Airport 4 Sale, Hurricane Hunters

Also: PWC PW307D, Icon Scandal, Memorial Day, IASO, Nat'l Warplane Museum, Gogo Cloud, Orbital ATK, Honor Flight Austin The Australia's Minister for Infrastructure and Transport, D>[...]

National Warplane Museum Establishes Crowdfunding Effort

Campaign Is Titled 'Let's Do A Little More For Les' The National Warplane Museum has kicked off its first ever crowd funding project. While many are aware of crowdfunding and how i>[...]

Delta Flight Intercepted By Greek F-16s

Airliner 'Briefly' Out Of Contact With Air Traffic Controllers On the same day that EgyptAir Flight MS804 disappeared from radar over the Mediterranean Sea, another airliner was in>[...]

Toledo Police Helicopter May Be Grounded

Department Seeks Grants To Help Keep Aircraft Flying The police department in Toledo, OH may be forced to ground its helicopter unless it is able to identify a grant for the $300,0>[...]

blog comments powered by Disqus



Advertisement

Advertisement

Podcasts

Advertisement

© 2007 - 2016 Web Development & Design by Pauli Systems, LC