Global airline losses to mount to $9 billion in 2009: IATA

Airlines worldwide are expected to suffer a combined loss of $9billion in 2009, according to a revised forecast by the International Air Transport Association (IATA). This is nearly double the association's March estimate of a $4.7 billion loss, reflecting a rapidly deteriorating revenue environment.

IATA also revised its loss estimate for airlines in 2008 to $10.4 billion from the previous estimate of $8.5 billion.

''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. After 11 September, revenues fell by 7 per cent. It took three years to recover lost ground, even on the back of a strong economy. This time we face a 15 per cent drop - a loss of revenues of $80 billion - in the middle of a global recession,'' said Giovanni Bisignani, IATA's director general and CEO.

''Our future depends on a drastic reshaping by partners, governments and industry. We cannot bear the cost of government micro-regulation, crazy taxation and partners abusing their monopoly power,'' he said in his `State of the Industry' address to 500 of the industry's top leaders gathered in Kuala Lumpur for the 65th IATA annual general meeting and World Air Transport Summit.

Recession is the most significant factor impacting the industry's bottom line. IATA's revised forecast sees revenues declining an unprecedented 15 per cent ($80 billion) from $528 billion in 2008 to $448 billion in 2009.

Air cargo demand is expected to decline by 17 per cent. In 2009, airlines are forecast to carry 33.3 million tonnes of freight, compared to 40.1 million tonnes in 2008. Passenger demand is expected to contract by 8 per cent to 2.06 billion travelers compared to 2.24 billion in 2008. The revenue impact of falling demand will be further exaggerated by large falls in yields-11 per cent for cargo and 7 per cent for passenger.