17-Jan-2012 12:03 PM

Traffic and profitability expected to decline, yield holding up: IATA

IATA stated (16-Jan-2012) airline profitability continued to deteriorate in 4Q2011. The trend is expected to continue into 2012 as the persisting weak economic conditions could finally start to take a toll on passenger travel. Details include:

  • Profitability: Confidence in airline profitability deteriorated markedly. The outlook for the next 12 months has also become increasingly pessimistic;
  • Traffic growth: With advanced economies anticipating a further slowdown in growth in 2012, the outlook for air traffic volumes has become increasingly negative;
  • Yield: Passenger yields may have improved a little in 4Q but expectations are for some further increases. Although traffic volumes have been weak, fares may be reflecting some of the high input costs – such as jet fuel prices – helping yield recovery slightly. Cargo yields were reported to have fallen sharply over the last three months, dropping below neutral levels on the weighted score scale. CFOs and cargo heads have shown they expect continued decline in the year ahead, but to a lesser degree than indicated in previous surveys. [more – original PR]

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