Latest IATA Projection Reflects Surging Profits, Industry Volatility
The International Air Transport Association (IATA) revised its 2010 airline industry outlook to reflect a projected profit of $8.9 billion, compared with t

The International Air Transport Association (IATA) revised its 2010 airline industry outlook to reflect a projected profit of $8.9 billion, compared with the $2.5 billion profit forecast it published in June. But despite what most would consider a glowing projection, IATA general director and CEO Giovanni Bisignani called for a “reality check” due to the razor-thin margins on which airlines operate. Meanwhile, in its first look into 2011, the association estimates that profitability will drop to $5.3 billion on a margin of 0.9 percent.

“This year is as good as it gets for this cycle,” said Bisignani. “Governments are running out of cash for pump priming. Unemployment remains high and business confidence is weakening. And we expect the 3.2-percent GDP growth of 2010 to drop to 2.6 percent in 2011. As a result, 2011 is looking more austere.”