IATA has left is global profit forecast for the year unchanged at collective industry profits of $3 billion.
Disclosing its latest quarterly update to its 2012 forecast during its annual general meeting today in Beijing, IATA highlights the recent easing in oil prices, robust passenger traffic and signs of a bottoming out in the freight market. This has helped offset the deepening European soveriegn debt crisis.
"The $3 billion industry profit forecast has not changed. But almost everything in the equation has," says IATA director general Tony Tyler. "Demand has been better than expected, so far this year. And fuel prices are now lower than previously anticipated, but that's on the expectation of economic weakness ahead.
"The Eurozone crisis is standing in the way of improved profitability and we continue to face the prospect of a net profit margin of just 0.5%," he adds.
Compared with the previous forecast in March, North American and Latin American carriers are expected to see improved prospects. But the outlook for European, Asia-Pacific and Middle Eastern carriers has been downgraded. Collective European carrier losses are now expected to be $1.1 billion - almost double the $600 million IATA was projecting they would lose three months ago.
A $3 billion profit this year is less than half the $7.9 billion the industry generated in 2011.
Source: Air Transport Intelligence news
