Another day, another bleaker outlook assessment for the airline sector. Speaking today at the Malaysian International Chamber of Commerce and Industry, IATA director general Giovanni Bisignani said the airline body would issue a revised forecast in the next week after describing its existing $2.5 billion industry global loss forecast for 2009 as "very optimistic".
"Just look at the numbers," says Bisignani. "January passenger traffic was down 5.6%. Premium traffic, where airlines make their money, was off 16.7%. And cargo is a disaster with a 23.2% fall. While low oil prices offer some respite, for many hedging strategies delay the full benefits of reduced costs.
"Our last industry forecast made in December was for a $2.5 billion loss in 2009 based on a 3% fall in passenger demand and a 5% drop in cargo. This is now looking very optimistic and next week we will issue a revised forecast," he says.
IATA has already indicated heavy charges incurred in the fourth quarter related to fuel hedging strategies means 2008 global losses could reach as much as $8 billion, higher than its original forecast of $5 billion.