Stark warning for Asian airlines as losses deepen in 2009

Asian airlines have the most belt-tightening to do if they want to return to profitability, according to the International Air Transport Association (IATA).

The IATA has revised its airline financial forecast for 2009 to a global loss of $9 billion, almost double its March estimate of $4.7 billion, due to a rapidly deteriorating operating environment. Asian airlines will conbtribute $3.3 billion to that figure, the largest among any region.

"There is no modern precedent for today's economic meltdown. The ground has shifted. Our industry has been shaken. This is the most difficult situation that the industry has faced," says Giovanni Bisignani, IATA's director-general and CEO in an address at the association's annual general meeting in Kuala Lumpur.

"Japan, the region's largest market, is in deep recession. The growth markets of China and India are delivering major losses as export-driven demand slows," says the IATA.

Both airlines and governments would do well to take heed - unchecked growth at any cost has resulted in this situation, which can only get worse if nothing is done to arrest the decline.