22 Sep 2010

Higher profit now expected by world airlines

9:48 am on 22 September 2010

World airlines are expected to post a profit of $US8.9 billion this year in a sharp upgrade of a previous forecast.

The International Air Transport Association said the industry recovery had been stronger and faster than anyone predicted.

In June, IATA forecast a much smaller profit of $US2.5 billion. In March, it had expected a loss of $US2.8 billion.

IATA said increasing demand and stable costs were driving the recovery.

However, chief executive Giovanni Bisignani noted the industry lost almost $US50 billion over the previous decade.

"There are lingering doubts about how long this cyclical upturn will last," he said.

IATA also said that Europe still "lags in the red".

Europe is the only region the organisation still expects to make a loss this year.

However, it now expects a smaller loss of $US1.3 billion, compared with June's forecast of $US2.8 billion.