Airlines suffered record drop in traffic

Geneva: International airlines suffered their biggest decline in traffic since 1945 last year as passenger demand fell by 3.5 per cent, the International Air Transport Association (IATA) said.
Freight also fell, by 10.1 per cent, as "full-year 2009 demand statistics for international scheduled air traffic showed the industry ending 2009 with the largest ever post-war decline," IATA said. "In terms of demand, 2009 goes into the history books as the worst year the industry has ever seen," said Giovanni Bisignani, director general of the world's biggest airlines' association.
"We have permanently lost 2.5 years of growth in passenger markets and 3.5 years of growth in the freight business," he added. Passenger traffic had improved in the final months of 2009, after a slump triggered by the financial and economic crisis. In December, passenger traffic increased by 4.5 per cent in December compared to the same month the previous year, and by 1.6 per cent over November, latest IATA data showed.
While airlines had continued to cut capacity and flights, yields were still five to 10 per cent below 2008 levels by the end of last year. IATA predicted a slow recovery for cash-strapped carriers. "Revenue improvements will be at a much slower pace than the demand growth that we are starting to see," said Bisignani. "Profitability will be even slower to recover and airlines will lose an expected $5.6 billion in 2010," she added.
The industry association warned last month that airlines faced another turbulent year after they racked up an estimated $11 billion in losses in 2009 despite a recovery in passenger traffic. "We are ending an Annus Horribilis that rings to a close the 10 challenging years of an aviation Decennus Horribilis," Bisignani told journalists last month. IATA represents some 230 carriers that account for more than 90 per cent of scheduled air traffic. AFP