Washington, Jun 02: The net financial losses for international airline operations in 2002 has been estimated at USD 3.8 billion and if the first quarter of 2003 is any indication following political crisis in Iraq and the outbreak of SARS in Southeast Asia, the forecast of 7.4 per cent growth in passenger growth may fall short by three to four points, the International Air Transport Association said. The association in its annual report released here at the 59th annual general meeting said the aggregate losses for member airlines conceal higher losses for North America-based airlines but a higher profitability for Asia Pacific-based airlines. Of particular concern to the industry was a significant structural change in corporate travel purchase behaviour, which saw a disproportionate decrease in premium yield traffic.
The fall seen in passenger traffic on individual route areas were dramatic with transatlantic and transpacific routes showing reductions of 10 to 20 per cent persisting for much of 2002, as well as poor yields. Though 2003 started with a slowing of economic growth prospects in more economies, affecting the outlook for airline growth, the industry suffered from political tension in the middle east, followed by the conflict in Iraq, impacting both the level of air travel demand and the cost base, particularly fuel, it said.
IATA said the SARS outbreak affecting Asia in particular has served to compound the disastrous fall in passenger demand in a region with the best growth potential. Bureau Report