Airlines in Deeper Trouble than Forecast

Airline losses in 2010 will total $5.6 billion, 47 percent wider than an earlier forecast, as oil prices rise while carriers compete for passengers with lower fares, the International Air Transport Association said.

Projected losses for 2010 are about half the $11 billion deficit that IATA predicts for this year. Passenger demand, after a decline of 4.1 percent in 2009, may grow by 4.5 percent in 2010 as the industry rebounds from the recession, IATA General Director Giovanni Bisignani said today in Geneva.

"Fuel costs are rising and yields are a continuing disaster," Bisignani said. Yields, or average fares, fell 12 percent in 2009 and will remain at depressed levels, he said.

The group had forecast in September that the industrywide loss in 2010 would be $3.8 billion. IATA said today that global revenue will rise by 4.9 percent to $478 billion in 2010, below the peak of $535 billion in 2008. (more)