Asian airlines anticipating further losses in 2009

The end of this year has brought a slump in passenger traffic for Asian airlines and 2009 looks as if it may be worse, according to industry experts.

“Last December I remember being in a very buoyant mood, telling you all that the airline was in excellent shape and the overall picture was very healthy,” said Tony Tyler, the chief executive of Hong Kong-based Cathay Pacific Airways in newsletter published by the carrier. “Now, as 2008 draws to a close, we are facing very uncertain times and the mood has turned decidedly sombre.”

The significant drop in the cost of jet fuel has provided a reprieve, but passenger demand has dropped sharply as both leisure and business customers cut back on travel. According to the International Air Transport Association (IATA), the industry is facing the worst revenue environment that has existed in 50 years.

Asia-Pacific airlines account for approximately one-third of the world’s passenger traffic and up to 45 per cent of the cargo market. Losses for 2009 are predicted to be more than double this year’s $500 million, reaching $1.1 billion in 2009, according to the IATA.

Aviation experts are saying that regional carriers are likely to weather the continued downturn than their peers in the US and Europe, as they have healthier balance sheets, and newer, more fuel-efficient planes, in most cases.

“Asia-Pacific airlines are generally better placed than their counterparts elsewhere amid difficult times but they will still feel the pain,” noted Nicholas Ionides, who is the regional managing editor of Singapore-based Flight International magazine.

Thanks to www.businessweek.com for the above quotes, for more information on this article please visit their website.

www.iata.org