IATA Lowers 2008 Airline Profit Forecast

New York: Worldwide airline industry profits are forecast to rise a weaker-than-expected 39 percent in 2008 due to rising oil prices and slower economic growth, a trade group said Monday.
The International Air Transport Association said it expects airlines to earn $7.8 billion profit in 2008. That is down from the group's June estimate of $9.6 billion.
Underlying the reduced forecast was a prediction that oil prices would average $67 a barrel throughout 2007 and $66 a barrel in 2008.
But the news was not all bad. IATA, which represents more than 240 airlines, now expects its members to post a 2007 profit of $5.6 billion, up from a previous estimate of $5.1 billion as increased demand more than offsets rising fuel prices.
Since 2001, Asia-Pacific carriers have added 42 percent to their capacity in preparation for the growing markets in China and India. That growth combined with a sluggish cargo market is expected to drop their profit by $100 million to $700 million this year, before it rebounds to $2 billion in 2008.
17/09/07 Associated Press/CNNMoney.com

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Categories: Foreign Sep 2007, General Aviation Sep 2007