# MISC | International Air Traffic News



## hkskyline

Tuesday June 29, 12:15 AM 
*Industry Group: Airline Traffic Soaring*

*Article 1 : IATA *

GENEVA – "Traffic growth for the first five months of 2004 is testimony to the resilience of air transport. Not only have we fully recovered from the impact of SARS and war in Iraq, all major regions of the world are reporting traffic levels above those of 2000—the last normal year for our industry," said Giovanni Bisignani, Director General and CEO of the International Air Transport Association (IATA). 

Passenger traffic on all international routes was up by 38% in May 2004 as compared to May 2003. For Asian airlines alone the increase was even more extraordinary at 108% indicating a full traffic recovery from SARS. Overall, passenger traffic for the first five months of 2004 was up 19.4% over 2003, while freight traffic improved by 12.2% for the same period. More meaningfully, when 2004 data is compared to 2000 for the same 5-month period, global passenger and cargo traffic have risen to levels 8.8% and 13.6% higher respectively.

Despite the shocks that have rocked the airline industry in recent years, the underlying industry annual growth rate is 3.6%, according to recent IATA trend analysis (chart attached). "Events beyond our control have clearly slowed the growth of the industry to half of what we experienced in the latter part of the 1990's. All things being equal, every 1% of growth adds US $1.6 billion to revenues on international services," said Bisignani.

"While oil prices have declined recently, every additional dollar over US$33/barrel generates US$1 billion industry losses. Efficiency gains and cost cutting remain priorities to return the industry to health. The IATA-led initiative to move the industry to 100% electronic ticketing by 2007 is an example of the serious approach that airlines are taking to cutting costs out of the system. Our partners in the value chain—particularly airports and air navigation service providers—must approach cost efficiency with equal resolve," said Bisignani.

*Article 2 : Reuters *

GENEVA - International air passenger traffic rose by 19.4 percent between January and May this year compared with the same period last year, the global airlines body IATA said on Monday. 
Freight traffic over the same five months was up 12.2 percent, according to figures released by the Geneva-based grouping, the International Air Transport Association. 

"Not only have we recovered from the impact of SARS and war in Iraq, all major regions of the world are reporting traffic levels above those of 2000, the last normal year for our industry," said Director-General Giovanni Bisignani. 

In May alone, passengers on all international routes were up 38 percent on May last year when the industry was suffering from the impact of the SARS flu-type epidemic that swept across Asia and reached Canada and fallout from the invasion of Iraq. 

For Asian airlines, IATA said, the recovery was even more dramatic. Traffic there in May was up by 108 percent on that of the same month last year, indicating that the "SARS effect" was well and truly overcome. 

IATA said the January-May figures showed passenger traffic up 8.8 percent over the same period in 2000, just before the onset of a global economic downturn which set the industry on a steep downward path. 

That decline was sharpened by growing global political instability after the September 2001 hijacking attacks in the United States, the U.S.-led assaults on Afghanistan and Iraq, global terrorism, and the SARS crisis. 

Earlier this year airline chiefs feared that steep rises in oil prices would hit the industry's overall global bottom line, but Bisignani, in a statement on the figures, said a recent decline had helped improve the situation. 

But efficiency gains and cost-cutting would have to remain priorities for airlines if the industry was to return to full health, he declared. 

IATA said that despite the shocks that had rocked the industry over the past four years, its underlying growth rate was 3.6 percent a year. However, this is still only half the rate achieved during the later 1990s. 

Of the major regions apart from Asia, North America saw a passenger growth of 32.8 percent in the first five months of this year over January-May 2003 and Europe saw an increase of 19.1 percent, according to IATA. 

In the Middle East, traffic was up by 43.9 percent, and in Latin America by 11.5 percent January-May. In Africa the increase was 8.3 percent.


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## hkskyline

IATA International Traffic Statistics: June 2004


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## hkskyline

Date: 26 August 2004
*Strong Traffic Growth but Profits Undercut by Sky High Fuel Prices*

GENEVA – "International passenger and cargo traffic growth continued to exceed expectations through July, however the extraordinarily high level of oil prices points to yet another year of significant airline losses," said Giovanni Bisignani, Director General and CEO of IATA.

"Ending the year with double-digit passenger growth is possible given the industry's performance for the first seven months of 2004. This includes a significant one-off rebound in traffic from SARS in 2003. More importantly, we are seeing a solid recovery in the underlying growth of international passenger traffic over the past year," said Bisignani. (Chart 1)

Asia continues to display a strong rebound from the traumatic events of 2003 with the January to July passenger traffic showing a 29.4% improvement on 2003 levels. Middle Eastern carriers exceeded that with 33.5% growth. All other regions also reported double digit year-on-year growth for the January to July period. When compared to the same period in 2000, the severe shocks of the last several years are apparent. Global passenger traffic in the first seven months of 2004 was just 8.2% above 2000 levels. By comparison, European carriers posted only 2.1% growth for the same period.

Freight volumes show solid and accelerating growth. Driven by buoyant world trade and far less distorted by SARS and other shocks affecting passenger traffic, year-on-year freight volumes grew 14.1% in the first seven months of 2004 over 2003 and 15.3% when compared to 2000.

"Positive traffic results have been overtaken by fuel costs. They are our biggest nightmare," said Bisignani.

Each dollar added to average price of a barrel of Brent over the year adds a US$1 billion to the industry's costs. Airlines are using capacity wisely with passenger load factors rising to 78.4% in July 2004. They are also taking a wide range of measures to improve fuel efficiency.

"But airlines cannot do it alone. The high cost of fuel exaggerates existing inefficiencies in the industry's infrastructure. Air traffic control delays and inefficient routings are wasteful – something we cannot tolerate. Our ATC partners must drive inefficiencies out of their systems," said Bisignani.

Statistics :
http://www.iata.org/NR/rdonlyres/ea...s4rdfnzfk5tf6imfqlqfh/StatstablesJuly2004.doc


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## David-80

hkskyline, do you have the details for each countries? I am interested to see how each countries air-traffic statistic perfomed this year.

thanks mate

cheers


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## hkskyline

The IATA doesn't publish statistics by country. They only release statistics by region. I'm not sure how each country discloses its own statistics. Some might do just numbers, others may include RPK, ASK, etc. Try checking the country's civil aviation authority for more information.


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## hkskyline

Wednesday September 15, 11:48 PM
*Boeing sees world air cargo growth at 6.2 pct*
By Chelsea Emery

NEW YORK, Sept 15 (Reuters) - Airplane manufacturer and defense contractor Boeing Co. said on Wednesday that it expects world air cargo to grow at an average annual rate of 6.2 percent during the next two decades, with overall traffic tripling from current levels.

"This year is shaping up to be the best year for world air cargo traffic growth since 1997," Tom Crabtree, regional director of marketing in Europe for Boeing Commercial Airplanes, said in a statement.

The world freighter fleet should increase to 3,456 airplanes from 1,766 during the 20-year forecast period, with the greatest growth in wide-body freighters such as Boeing's 747, 767, MD-11 and the Airbus A-300 and Asian air cargo markets leading the industry in average annual growth, according to Boeing.

The strongest growth year-to-date has come in the trans-Pacific and Europe-Asia markets, Boeing said. Looking forward, North America-Asia is forecast to grow at an average rate of 7.2 percent and Europe-Asia growth is seen at 6.7 percent, while lower growth rates will be found in intra-North American and intra-European markets.

BENEFITS TO BOEING

The company benefits from sales of new planes, as well as converting old passenger planes to freighters, said Cai von Rumohr, an aerospace analyst with investment firm SG Cowen.

"It's definitely a positive because cargo is a growing market," von Rumohr said. "In general, cargo is expected to grow somewhat faster than the passenger market."

Other companies that gain from a stronger market for cargo include Airbus, which is working on the newest large airliner A-380, and cargo carriers FedEx Corp. and United Parcel Service Inc. , von Rumohr added.

The forecasts are also available through Boeing's World Air Cargo Forecast 2004/2005, released Wednesday at http://www.boeing.com/commercial/cargo.

Boeing has provided more than 70 percent of the existing world jetliners, according to the company.

Of the 2,950 freighters expected to join the fleet, 1,260 would be replacements for retired aircraft and 1,590 for growth, the company said.

"With the challenges of the past few years, the air cargo market's strength has been encouraging," Marlin Dailey, vice president of sales in Europe and Central Asia, said in the statement.

Boeing shares were down 31 cents, or 0.5 percent, at $53.61 in mid-morning trading on the New York Stock Exchange. The Standard & Poor's aerospace and defense index was off 0.5 percent.


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## hkskyline

*Air cargo strength points to recovery *

_KEITH JOHNSON 
Wall Street Journal 
17 September 2004 _

BILBAO, SPAIN 

The global air-cargo market is growing at its fastest pace in almost a decade as Asian manufacturers and exporters recover, potentially signalling that economic recovery around the world could be stronger than has been anticipated. 

World air-cargo shipments grew 14 per cent through the first seven months of the year, according to industry trade group International Air Transport Association, marking the first double-digit increase in that time period since 1997. Top Asian markets still are growing at that pace, the latest figures suggest: Singapore's Changi Airport, a crucial freight hub for global trade, this week reported 12-per-cent cargo growth in the year through August, compared with a year earlier. 

Luxembourg-based Cargolux Airlines International, Europe's largest all-freight carrier, said sales grew “in double digits” in the first half of 2004 with the sector poised to enter peak season. “There's no reason for growth to slow down the rest of the year, and capacity in general is very tight in most markets,” said Robert van de Weg, Cargolux's vice-president of sales. 

The air-cargo market usually grows at twice the growth rate of gross domestic product and, as such, is considered a leading economic indicator. The 14-per-cent growth in air cargo is far faster than is suggested by the Organization for Economic Co-operation and Development's predictions of GDP growth around the world in 2004 — 4.7 per cent for the United States, 1.6 per cent in the euro zone and 8.3 per cent for China. 

Air cargo accounts for about 42 per cent of world trade by value, though only about 2 per cent by volume, according to the International Air Cargo Association in Miami. Traffic is measured in terms of revenue ton kilometres — that is, one ton of freight flown one kilometre. 

This year's strong growth continues the sector's performance in 2003, when it moved a record 156 billion ton-kilometres of cargo around the world, up 4 per cent from 2002. “This could be the year of biggest growth in the last decade,” said Thomas Crabtree, a cargo revenue analyst at Boeing Co. and the lead author of a new cargo market forecast released this week at an industry conference in Bilbao. 

The air-cargo market's strength stands in stark contrast to the woes of passenger airlines, as a number of carriers struggle. In the past 10 years, on the other hand, world air-freight tonnage has grown by 80 per cent because of a rise in international trade and changes in production methods and delivery habits among manufacturers.


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## Guest

The Are Now 34 Direct Perth - Singapore Services A Week With Up To 6 A Day By Qantas & Singapore Airlines, Last Year It Was Australia's 3rd Busiest International Route


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## hkskyline

*World's Largest Cargo Airports (January - May 2004)*
Source : ACI 
1. Memphis 1,468,307 +5.5%
2. Hong Kong 1,188,866 +14.1%
3. Tokyo Narita 944,791 +12.3%
4. Anchorage 899,680 +14.5%
5. Seoul Incheon 848,364 +20.2%
6. Los Angeles 757,195 +3.7%
7. Frankfurt 728,976 +9.2%
8. Miamai 720,808 +8.5%
9. Singapore 714,796 +9.6%
10. Louisville 700,352 +9.6%


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## huaiwei

perthwa said:


> The Are Now 34 Direct Perth - Singapore Services A Week With Up To 6 A Day By Qantas & Singapore Airlines, Last Year It Was Australia's 3rd Busiest International Route


 Cool! I would have expected the busier routes to come out of Sydney and Melbourne, and not Perth! Goes to show just how much exchanges there are between Perth and Singapore? 

We are just waiting for a budget flight between the two cities now!


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## hkskyline

*Soaring Oil: Airlines Will See Hefty Losses, Global Trade Group Projects *
29 September 2004
The Asian Wall Street Journal

The International Air Transport Association said it expects the global airline industry to have an overall loss of $3 billion to $4 billion in 2004, as high fuel costs outweigh strong increases in international traffic. 

IATA, the global industry trade group, said international passenger-traffic for the first eight months of 2004 rose 18.7% from a year earlier, while international cargo traffic rose 14.2%. "The increase in traffic is well beyond our expectations" but won't offset surging fuel costs, said Giovanni Bisignani, IATA director-general and chief executive. 

The growth in traffic for January through August partly reflects the depressed levels of a year earlier, when the severe-acute-respiratory-syndrome crisis hurt business. Still, "indications of healthy traffic growth are clearly evident in the August performance," which included an increase of 10.8% in international passenger-traffic, IATA said. 

The projected loss of $3 billion to $4 billion, based on an average benchmark oil price of $37 a barrel, would represent a narrowing from a total industry loss of $6.5 billion last year. Overall, the industry had a loss of $30 billion from 2001 to 2003, IATA estimates. Earlier in the year, the association had forecast that the industry would have an overall profit of $3 billion this year. 

Meanwhile, investment-research firm UBS cut its ratings and target prices on several Asian carriers, including the three listed in Hong Kong, citing slowed demand and high oil prices. 

"We have downgraded our estimates, ratings and price targets for a number of Asia-Pacific airlines as the first signs of a revenue slowdown appears," UBS analyst Timothy Ross wrote in a research note. 

UBS cut Cathay Pacific Airways to a "neutral" from "buy," and lowered its target price to HK$14.50 (US$1.86) from HK$17. 

The house said Cathay Pacific has only covered 9% of its jet-fuel requirements for 2005, and the Asian region, which accounts for more than 60% of its revenue, has recently shown signs of slowing demand. 

The note said demand among carriers of the Association of Asia-Pacific Airlines peaked in May year-to-year, while bookings for future travel through computer-reservation systems suggest that demand growth in 2005 will be slower than expected. 

The rating for China Southern Airlines also was cut to "neutral" from "buy," with the target price reduced to HK$3.15 from HK$3.30. UBS also cut ratings for China Eastern Airlines to "reduce" from "neutral," with a target price of HK$1.35, down from HK$1.57 previously. 

UBS also cut ratings for Thai Airways International and Asiana Airlines to "reduce" from "neutral." 

The house rates Qantas Airways, Singapore Airlines, China Airlines and EVA Airways as "buy."


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## hkskyline

October 4, 2004
*Boeing predicts healthy world aviation market*









_Boeing Headquarters in Chicago_

WASHINGTON (AFP) - Boeing Co. predicted the world aviation market will pull out of a post-September 2001 slump with two trillion dollars in plane sales in the next 20 years.

In the period from 2004 to 2023, the world economy would grow at a pace of 3.0 percent a year, driving traffic passenger growth of 5.2 percent a year and cargo traffic growth of 6.2 percent a year, it said.

Boeing forecast a total market potential of 24,993 new commercial airplane sales worth about two trillion dollars over the period. Even after retiring 6,397 planes, the world fleet would double to 34,764.

"The long-term forecast for air travel is healthy," said Boeing's annual Current Market Outlook 2004.

World air travel had grown in 30 of the past 34 years, contracting only in 1991 and from 2001 to 2003, it said.

"Currently, the world air travel market is recovering and 2004 is poised for double-digit traffic growth."

Boeing said the market share for the biggest planes such as its 747 or the larger challenger developed by rival Airbus, the double-decker A380, would shrink to four percent from six percent now.

Other twin-aisle planes, such its own mid-sized, fuel efficient 7E7 Dreamliner would gain market share to 21 percent from 18 percent now, Boeing said.

By 2023, three quarters of the world fleet would be single-aisle planes, it said.

The aerospace and aviation group said it expected further deregulation, intensifying competition over the period.

"Typically, when deregulation occurs competition increases among airlines," it said.

"History shows that competition leads to an increase in new nonstop market and frequency growth, rather than an increase in average airplane size in seats."

Most of the growth in the world's airlines will be in increased frequencies and new routes served by small and intermediate-sized planes, it said.

"The large airplane market is small," Boeing said. While the intermediate-size fleet would double, the large plane fleet would grow by about one-quarter.

Overall, China would lead growth in air travel with demand in more mature economies growing at a slower pace.

Over the 20 years, air travel growth was expected to expand by 8.1 percent a year in China, 7.6 percent in Latin America, 6.1 percent across the Pacific, 6.0 percent between Europe and the Asia Pacific, 5.5 percent in the Asia Pacific excluding China and 4.1 percent in Europe.

As a result, the North American share of world traffic would shrink to 20 percent from 24 percent and the European share would decline to 12 percent from 14 percent.

Meanwhile, the intra-Asia-Pacific share would rise to 18 percent from 15 percent and the Latin American share would double to four percent from two percent.


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## hkskyline

Date: 15 December 2004
*International Cargo and Passenger to Grow at 6.0% Yearly to 2008*
Strong Growth Reinforces Need for Structural Change

(Geneva) The International Air Transport Association released cargo and passenger traffic forecasts for 2004-2008 indicating 6.0% growth annually for international passengers and 6.0% annually for international cargo tonnage.

"It looks like we will finish 2004 with the strongest traffic rebound that the industry has seen since the 1991 recovery from the effects of the Gulf War. Expectations for the rest of the forecast period are in line with historical industry trends. If nothing changes in the operating environment, this is the start of a good news story for the industry," said Giovanni Bisignani, IATA's Director General and CEO.

Passenger numbers for 2004 are expected to grow by 11% over 2003 (14% if measured in revenue passenger kilometers). While this phenomenal growth is largely related to a recovery from the disastrous impact of SARS in 2003, two underlying factors are important. First, the robust economic expansion is the strongest in three decades. Second, increasing liberalization and intense competition in many markets is driving growth with declining yields.

China and India will be the main engines of growth for passenger traffic. International markets within Asia Pacific are expected to grow at 8.3% over the forecast period. Europe-Middle East growth, while from a much smaller base, will also be exceptional at 7.7% reflecting rapid expansion plans by Middle Eastern carriers.

Freight will also see double-digit growth in 2004, increasing 10.1%. The 6.0% freight growth forecasted through 2008 relies heavily on Asia-Pacific with markets linked to China and India expected to growth most rapidly. Europe to Asia-Pacific will be the fastest growing market with 7.0% annual growth. Traffic within Asia Pacific and between the Middle East and Europe will also be above the global average at 6.1%.

"Strong traffic growth is only half the story. Damaged balance sheets from four successive years of record losses totally in US$35 billion and three years of lost growth will take more than a rebound in traffic to repair. Structural change is essential to return the industry to health," said Bisignani.

Table : http://www.iata.org/pressroom/industry_stats/2004-12-15-03.htm

*Editor's Notes:*

1. IATA Passenger and Cargo forecasts are published annually. These are five-year forecasts for major global traffic flows combining data from participating IATA airlines, other industry data sources and historical knowledge. Full forecasts may be purchased through the IATA Online Store www.iata.org.
2. IATA's Monthly International Statistical Data is based on revenue passenger kilometers and freight tonne-kilometres. Forecast data is for passenger numbers and tonnes uplifted.


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## hkskyline

*Asian air traffic to grow 6 percent over the next 20 years: analysts *

SINGAPORE, Jan 24 (AFP) - Air traffic in Asia is likely to grow more than six percent annually over the next 20 years as the low-cost airline industry booms, the China market expands and government regulations are stripped away, an aviation conference heard Monday. 

Centre for Asia Pacific Aviation managing director Peter Harbison said 2004 had been a "watershed" year in terms of Asian market liberalisation. 

"The irreversible processes and changes that have taken place in the past year will accelerate further progress and growth in the regional airline industry," Harbison told an Asian and Middle East aviation outlook conference. 

He referred to a study conducted by aeronautical giant Airbus which said the Asia-Pacific will soon overtake the United States as the region with the strongest long-term air traffic growth. 

Another study conducted by rival aircraft maker Boeing estimates that Aisa-Pacific air traffic will grow 6.1 percent annually over the next 20 years. 

Harbison said this figure was likely to be conservative, given the "overpowering impact of regional low-cost carriers". 

Opening the conference, Singapore Transport Minister Yeo Cheow Tong also cited the two studies in an upbeat assessment of the long-term growth prospects for Asia's aviation industry. 

"I am confident that air travel within Asia will continue to grow rapidly ... the future of air travel in this region remains bright," Yeo said, adding China and India would be the main catalysts for the industry's expansion. 

Association of Asia Pacific Airlines director general Andrew Herdman backed up the long-term forecasts, which follow 20 percent growth in 2004 as the industry rebounded from SARS and a global economic downturn the previous year. 

"Clearly there are some markets where you will see double digit-growth but overall 5.0-6.0 percent is sustainable," Herdman told the conference. 

Harbison said there was almost unlimited potential for the regional aviation industry if the north Asian markets were liberalised. 

"There's such a tremendous potential in the markets involving China, Japan and Taiwan to be unlocked, the sky's the limit if these markets are opened up," Harbison said. 

He said China, in particular, with its estimated 40 million outbound travellers in 2005, was set to become a major influence in regional aviation policy. 

Harbison singled out the tiny city-state of Singapore, which serves as a regional aviation hub, as playing a vital role in pushing forward the region's "continuum of liberalisation". 

He said the government's successful efforts last year in establishing the city-state as a low-cost carrier hub would have a particularly powerful impact on the industry. 

Jetstar Asia, which is 49 percent owned by Australian national carrier Qantas, and two predominantly Singaporean ventures, Tiger Airways and Valuair, began services based here last year. 

The government also announced it would build Asia's first dedicated low-cost carrier terminal, which will operate alongside Changi airport from 2006. 

"Singapore has made entry into the airline business a lot easier in the future and has set the trend of a much broader definition of airlines, one geared more towards public interest as opposed to the government's," Harbison said. 

Harbison warned, however, there were issues that regional carriers had to be wary of, including an acute shortage of skilled staff to keep up with the rapid fleet expansion. 

He also said there was a "crying need" for airlines to restructure to cope with the industry's new demands. 

"A lot of excitement is being generated with all changes taking place but network carriers must remember that they still have to work very hard to cope with all these changes," Harbison said.


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## hkskyline

Tuesday January 25, 1:47 PM
*INTERVIEW:Arab Carriers' Asia Traffic Seen Up 15% In '05*
By Abdul Hadhi
Of DOW JONES NEWSWIRES

Arab airlines expect their Asia traffic to grow about 15% this year as heightened security measures in the West continue to discourage Arab tourists, an industry official said late Monday.

"Asia ranks almost an equal second with Europe in size and traffic for Arab airlines. This market will surpass Europe in 2006, if not 2005," Abdul Wahab Teffaha, secretary general of the Arab Carriers Organization, or AACO, told Dow Jones Newswires.

Abdul Wahab was in Singapore attending an aviation conference.

Asia accounted for 20 million in terms of passenger traffic in 2004, one-third of the Arab travel market, Abdul Wahab said. This marks a 14% increase from 2003.

Europe also accounted for 20 million passengers, while inter-Arab, or within the Arab region, accounted for about 25 million. Abdul Wahab projects that growth in European traffic will be less than that projected for Asia.

Arab tourist traffic shifted dramatically to Asia from the U.S. and Europe after the Sept. 11, 2001, terror attacks in the U.S., and Arab traffic to Asia has been growing steadily since, particularly to Malaysia, Indonesia, Singapore and Thailand.

"There has a been a short retraction because of the tsunami, but bookings for next season are back to normal," Abdul Wahab said, referring to the Dec. 26 earthquake and massive waves that killed over 150,000 people and devastated Asian tourist hotspots such as Phuket and the Maldives.

Arab airlines, led by Emirates Airline (EA.YY) and Qatar Airways, are leading the industry growth in overseas revenue.

Emirates claims to be among the world's five most profitable airlines. It reported a 74% rise in net profit to US$429 million for the year ended March 31, 2004.

While the Middle East continues to be plagued by the Arab-Israel conflict and tensions in Iraq, Arab airlines have found "an oasis of stability" outside the region, Abdul Wahab said.

They have also benefitted from Arabs' increased disposable income amid rising oil prices, which result in greater revenue for oil-exporting countries, he said.

Such higher income of customers has offset the rise in fuel costs for these airlines; fuel costs have increased from 15% of total costs in 2000 to the current 23%.


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## hkskyline

*IATA says 2004 air passenger traffic rose 15.3 pct but losses reach US$4.8 bln *
31 January 2005

GENEVA (AFX) - The International Air Transport Association (IATA) said world air passenger traffic staged a 'phenomenal' recovery in 2004 and grew by 15.3 pct from 2003, but airlines struggled to find profits, the chief industry association said. 

IATA said in a statement that all regions had reported double digit growth, led by the Middle East with 24.8 pct passenger growth for 2004 over the previous year. 

However, industry-wide losses reached an estimated 4.8 bln usd with the price of fuel remaining 'a critical factor for airline profitability,' according to the association, which groups 270 major carriers. 

Asia recorded 20.5 pct growth in air passenger traffic in 2004, it added. 

'The traffic recovery in 2004 was phenomenal across all regions,' said Giovanni Bisignani, director general of IATA. 

Growth in Europe reached 10.1 pct, while air passenger traffic in North America rose 14.8 pct. 

The global growth data exceeded IATA's predictions last month of 11 pct growth for 2004 as a whole. 

'The challenge for 2005 is to turn traffic growth into profitability with improved cost efficiency across the industry's value chain,' Bisignani said. 

IATA forecast that the industry as a whole could achieve profits of 1.2 bln usd this year, provided oil prices average 34 usd a barrel. 

However a barrel of North Sea Brent crude was trading at 43.96 usd in London today. 

Bisignani said his members are trying to cut costs and increase efficiency, and urged other parts of the air transport supply chain -- notably air traffic control and airports -- to slash their bills. 

'We ask the same of our partners, many of whom are monopolies,' he told a meeting of the Civil Air Navigation Services Organization (CANSO), which groups air traffic control operators worldwide, in the Dutch city of Maastricht. 

IATA said the bill for air traffic control had increased by 9.4 pct since 1999 to 8 bln usd while airline yields had fallen. 

Bisignani charged that the cost efficiency of air navigation firms was 'simply not good enough'. 

'Our customers demand that we evolve to a low cost industry with simplified business processes. Our partners, including navigation service providers and airports, must be a part of that evolution,' he added. 

Bisignani reiterated a call for more harmonisation of air traffic control across borders and for airlines to have a say in the adoption of new technology. 

Airliners had managed to save 1.1 bln usd in 2004 by negotiating with governments, notably in Iraq, China and Mexico, to make flights more direct, reducing the duration of a journey, IATA underlined last month. 

Major carriers have also suggested making electronic tickets the norm instead of traditional paper copies, and called for cuts in airport landing and handling fees. 

IATA does not include independent budget airlines such as Easyjet and Ryanair, which have brought stiff low-fare competition to the industry.


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## hkskyline

*Asian airlines carry record number of passengers, cargo in 2004: AAPA *
03 February 2005
Agence France Presse

Airlines based in the Asia Pacific carried a record number of passengers and cargo in 2004 and the outlook remains buoyant for this year, an industry association said Thursday.

The Association of Asia Pacific Airlines (AAPA) -- which groups 17 premium carriers -- said 117 million passengers were carried last year, up 22.5 percent from the SARS-ravaged year of 2003 and 7.3 percent higher than 2002.

Air cargo volumes also set new records, with traffic measured in freight tonne-kilometres up 12.9 percent.

The record air and cargo volumes were achieved despite growing competition from low-fare carriers and high oil prices, which touched record levels near 60 dollars a barrel in October.

"Helped by strong global economic growth, 2004 was a remarkable year in terms of traffic recovery and new growth for the AAPA member airlines," said AAPA director-general Andrew Herdman in a statement received here.

"Despite high fuel prices and competitive pricing pressures, the strong traffic growth and tight cost controls led to a general improvement in profitability."

Herdman said passenger traffic should grow 6.0-7.0 percent this year, with AAPA member airlines expecting the delivery of 73 aircraft in addition to the existing fleet of 1,273, mainly wide-bodied planes.

The AAPA members are Air New Zealand, All Nippon Airways, Asiana Airlines, Cathay Pacific Airways, China Airlines, Dragonair, EVA Air, Garuda Indonesia, Japan Airlines, Korean Air, Malaysia Airlines, Philippine Airlines, Qantas Airways, Royal Brunei Airlines, Singapore Airlines, Thai Airways International and Vietnam Airlines.


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## hkskyline

*European airport traffic up 7.5 percent in 2004, airport group says *
11 February 2005

BRUSSELS, Belgium (AP) - Europeans flew 7.5 percent more in 2004 than 2003, according to statistics released Friday by Airports Council International Europe, the nonprofit group representing 450 European airports. 

The biggest airports in Europe, such as London Heathrow, Paris Roissy and Frankfurt with more than 25 million passengers per year, experienced an average increase of 3.2 percent in 2004. 

Ronan Anderson, communications manager for ACI Europe, based in Brussels, said the increase in air-passenger traffic showed positive signs that the airline industry was finally bouncing back and surpassing the slump experienced after the Sept. 11, 2001 terrorist attacks. 

"Historically, traffic has always increased by 5 to 6 percent or so per year," Anderson said. "We're just getting back to that level." 

Highlighting the rise since the attacks, Anderson said London Heathrow had 67.3 million passengers in 2004, compared to 64.6 million in 2000. 

Anderson said he expected the air traffic in Europe to double by 2020. 

The ACI's report also said the greatest percentage increase in passenger traffic, 11.1 percent, occurred at airports with less than 5 million passengers per year. Regional airports at Liege; Belgium; Riga, Latvia; and Girona, Spain, each had increases of more than 90 percent. 

Anderson said the increase in the smaller airports was greatly attributed to low-cost airlines like Ryanair and EasyJet encouraging more travel throughout Europe. 

"The explosion of traffic at these regional airports due to low-cost airlines has had a massive impact on traffic throughout Europe," he said. 

On Tuesday, the European Union head office announced it would create new rules to clarify what aid can be given to regional airports and airlines across Europe.


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## hkskyline

*Airlines temper enthusiasm for strong travel growth amid high oil prices *

GENEVA, Feb 28 (AFP) - International air travel grew by 7.9 percent in January, marking a stronger than expected growth in business for airlines compared to the same month last year, the main industry body said Monday. 

But the International Air Transport Association (IATA) predicted that passenger traffic would grow by just 5.9 percent this year, well below the "phenomenal" 15.3 percent growth experienced in 2004 when the industry emerged from a slump in air travel. 

Although the forecast was close to annual growth targets until 2008, IATA warned in a statement that high oil prices would also continue to harm airline finances. 

"While the profitability picture for the industry is increasingly regionalised there is a universal theme for 2005: austerity," IATA Director General Giovanni Bisignani said. 

"There is no panacea for the problems of the industry, but cost control must be firmly at the top of the agenda for all players," he added. 

Growth in the Asia and Pacific region was stifled by the tsunami that devastated some major tourist areas in south Asia in late December, according to IATA, which groups 270 major carriers. 

Air passenger traffic in Asia edged up 2.5 percent in January. 

"We are off to a great start for 2005 for international traffic," Bisignani said. 

"There is stronger than expected growth in all regions, except for Asia Pacific which suffered from the impact of the Indian Ocean tsunami," he added. 

Global air freight traffic grew by 15.5 percent in January. 

Despite its caution for the coming year, IATA said Asian, European and Middle Eastern carriers were reporting better profits. 

But it warned that beneath strong air traffic, airlines in the United States were struggling financially as yields on domestic flights came under pressure. 

Airlines in the US had been propped up by the continuing weakness of the US dollar and had redeployed capacity to international routes in order to post an 11.8 percent increase in air travel in January, the industry group said. 

IATA also criticised new government regulation of the air transport industry, especially the European Union's introduction of new, boosted, compensation for passengers who suffer delays or cancellations. 

"These add costs and complexity to an industry that is simplifying to reduce costs and provide better value to consumers," Bisignani said. 

"At the same time politicians are bantering proposals for new taxes on aviation that ignore the fact that aviation already entirely funds its own infrastructure," he added. 

French President Jacques Chirac recently revived the idea of a possible international tax on air tickets as a way of raising revenue to fight poverty. 

Airlines in some parts of western Europe are facing competition from an expanding network of high speed railway services built by state-owned operators in recent years.


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## hkskyline

*Asia-Pacific travel up 1.3 percent in January: AAPA*

AFP - Passenger traffic in the Asia Pacific rose 1.3 percent in January from the previous year to more than 10 million, an industry group said.

The small percentage rise was due to a higher base of comparison as the Lunar New Year holidays last year fell in January, compared with February this year, the Association of Asia Pacific Airlines (AAPA) said in a statement.

"The small measure of positive passenger traffic growth in January did not quite match the growth in capacity but does reaffirm the underlying strength of travel demand," said AAPA director-general Andrew Herdman.

"Any post-tsunami effects appear to have been limited to specific areas within the region."

Airlines based in the region carried 10.072 million passengers in January, compared with 9.946 million in January 2004, with the load factor falling to 74.1 percent from 75.8 percent.

Freight traffic in January jumped 10.7 percent as last year's Lunar New year holidays dampened manufacturing activity.

AAPA members are Air New Zealand, All Nippon Airways, Asiana Airlines, Cathay Pacific Airways, China Airlines, Dragonair, EVA Air, Garuda Indonesia, Japan Airlines, Korean Air, Malaysia Airlines, Philippine Airlines, Qantas Airways, Royal Brunei Airlines, Singapore Airlines, Thai Airways International and Vietnam Airlines.


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## hkskyline

*Airlines, resorts hope to keep numbers up over holidays amid global financial crisis*
24 October 2008

ATLANTA (AP) - Minneapolis business manager Roque Rossetti plans to make his annual trip home to Sao Paulo, Brazil, for Christmas. The 35-year-old said the sagging economy gave him no second thoughts about shelling out $1,200 for the ticket.

"If I wait longer, I'd probably pay more, and I might not end up going," he said. But, he added, "I'm secure. I don't have kids or a wife. My house is paid for."

Several carriers have said that advance bookings show their planes are expected to be as full as or fuller than a year ago over the late fall and winter holidays -- largely because they have taken so many seats out of the air, a decision that was made when fuel prices were soaring. In fact, travelers who have not booked flights for the holidays could find it more difficult and expensive than usual to find the flights they want, when they want them.

Because of the capacity cuts, fuller planes do not mean more people will be flying. It also may be tougher for ski resorts and sunny vacation destinations to keep their numbers up, though some are offering promotions to lure holiday travelers who may be hesitant to open their wallets amid an uncertain economy.

"I think the consumer now has a lot of things on their mind -- they're concerned about the economy, they're concerned about the election, but I think they have already made the decision about what they are going to do over Thanksgiving and Christmas," said Arne Haak, chief financial officer of discount carrier AirTran Airways.

Haak said the carrier -- a unit of Orlando, Fla.-based AirTran Holdings Inc. -- has not seen a slowdown in bookings over the holidays.

"In fact, Christmas looks very, very good," he said.

The picture is similar at Atlanta-based Delta Air Lines Inc., an executive said.

"I think it might be the newness of the information," Ed Bastian, Delta's chief financial officer, said of travelers' response to the economic crisis.

He said most consumers are still trying to figure out what the crisis means to them. Bastian said Delta's domestic advance bookings for the holidays show stronger occupancy rates on a year-over-year basis and are in line with the carrier's expectations, though he noted capacity cuts may be playing a role in that. On the international side, he said November-December occupancy rates based on advance bookings are down, though he noted Delta is increasing capacity on overseas flights.

At American Airlines, a unit of Fort Worth, Texas-based AMR Corp., its occupancy rate based on advance bookings for the fourth quarter is down about 2 percentage points year-over-year, Chief Financial Officer Tom Horton said. That's "not outside of the norm you might see varying from year to year, but remember we are taking capacity out of the system," Horton said. The fourth quarter, which includes the holidays, is traditionally a slow period for airlines.

While he would not offer specifics for the holiday season itself, Horton suggested the carrier was not expecting a big drop-off in sales during the time period.

"I don't see anything unique to the holiday period right now," Horton said.

A big change may be that, with the economy suffering, people are looking for better deals.

During a recent stop at Minneapolis-St. Paul International Airport, Georgeann Becker, 60, an attorney from a suburb of Denver, said she and her husband paid for a plane ticket for their daughter to fly home from New York to visit them this Christmas. Her daughter shopped around at the online travel sites and found a cheaper ticket than their travel agent, at around $350, which the Beckers are paying.

"I don't know that we're necessarily holding back. I think you do go out of your way to find the cheapest ticket," Georgeann Becker said.

Esmeralda Perez, a spokeswoman for the Puerto Rico Hotel & Tourism Association, said travelers appear to be waiting to book their vacations until closer to the holidays.

The island's hotels and resorts are being more aggressive with promotions and packages than in past years to lure last-minute guests, she said. The government-sponsored Puerto Rico Tourism Co. has doubled its advertising and marketing spending as well.

Perez said the election in November may also be adding to the broader economic uncertainty. In past election years, she said hotels have seen a surge of holiday bookings after the election.

Cayman Islands Tourism Minister Charles Clifford said cutbacks by carriers within the U.S. have pushed up fares to the islands. In response, Cayman Airways is adding nonstop service from Washington and Chicago to the British dependency beginning in December.

Ski.com, which books vacations at 80 resorts in the western U.S., Canada, Europe and South America, has seen sales slip compared to last year, said spokesman Dan Sherman.

As of September, Vail Resorts Inc. Chief Executive Rob Katz said the number of Colorado season passes sold was down 8.4 percent. Advance lodging bookings through central reservations were down 17.7 percent in room nights over the same period last year.

Recently, the company announced a slate of new promotions, including offering a free night to guests who book a five-night stay or more on dates around Thanksgiving, Christmas, New Year's and other major holidays in 2009.

Katz expects the company's marketing message to penetrate following the election. "I think we will potentially see a different environment by Thanksgiving than what we're seeing today."

Andy Wirth, the chief marketing officer of resort owner Intrawest ULC, said consumers seem to be favoring ski destinations within driving distance this year, although he noted that airline capacity has held steady at the three airports that service its western resorts.

He is optimistic about a major marketing push planned for shortly after the election in November. "The destination skiing customer is a very resilient customer base," he said.

Alain Brochu, a vice president of Intrawest's Mont Tremblant in Quebec, said the resort is seeing increased sales from promotions targeted to individual travelers so far this season. He said one strong seller is the $129 pass, good for 3 days of skiing.

"Preliminary results indicate that adapting to the market rather than trying to change it has generated good response," he said in an e-mail.

Airlines are not sure how long demand will hold up for them, and several expressed concern recently that demand will drop off in 2009 as the realities of a recession set in for more travelers.

AirTran's Haak said "obviously that is something we're going to keep an eye on."


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## hkskyline

*Asian airlines brace for worse turbulence next year: analysts *
25 October 2008
Agence France Presse

Asia's aviation sector is hurting from a sharp descent in passenger numbers but the full impact of a deepening global financial crisis is not likely to be felt until next year, analysts said.

Small carriers will be particularly vulnerable as people curtail travel plans, they added, predicting some airlines will not make it through.

"The biggest challenges right now are weakening passenger demand, particularly for first and business class travel, and continuing uncertainty about the global economic outlook," said Andrew Herdman, director-general of the Association of Asia Pacific Airlines (AAPA).

"The next 12-18 months will be extremely difficult times for airlines and some won't survive the current crisis," said Herdman, whose AAPA represents 17 airlines in the region.

Shukor Yusof, an aviation analyst with credit rating agency Standard and Poor's, said he expects some airlines to defer aircraft orders or return leased planes as they reduce routes and flight frequencies.

"The weakest ones will not be able to maintain the business," he said.

The International Air Transport Association (IATA) said passenger volumes for Asia Pacific carriers dropped 6.8 percent in September, much sharper than the average 2.9 percent decline worldwide.

Asian airlines also carried 10.6 percent less cargo in September, worse than the drop in Europe and North America, as trade volumes fell sharply, IATA said.

"The deterioration in traffic is alarmingly fast-paced and widespread," IATA director-general Giovanni Bisignani said in a statement.

"We have not seen such a decline in passenger traffic since SARS in 2003," he added, referring to the health scare that grounded travellers in Asia.

Analysts fear that unlike during the SARS period, which lasted for a few months, the current crisis will last for a year or more.

Losses for global airlines this year may exceed IATA's earlier projection of 5.2 billion US dollars, with another further 4.1 billion dollars in losses seen in 2009.

Business class travel, a major cash-spinner for airlines, has become an early casualty of the crisis, especially with retrenchments and belt-tightening in the financial sector, analysts said.

Leisure travel is also suffering as tourists stay home or travel to nearer destinations.

Singapore Airlines said it carried 1.6 percent fewer passengers in September from a year ago.

Singapore's Changi Airport said it handled 2.89 million passengers in September, down 0.4 percent from last year -- the first decrease in monthly traffic since February 2004, the airport operator said.

Hong Kong's Cathay Pacific said passenger numbers in September dropped 0.7 percent year-on-year, while Australia's Qantas said the number of international passengers it carried fell an annual 6.4 percent in August.

"People in the source countries are beginning to say: 'Well, let's rethink what we're going to do for the holidays,'" said John Koldowski, an analyst with Bangkok-based Pacific Asia Travel Association.

"It will take a little bit of time because some have already booked their tickets. But if this progresses, we're going to see a much deeper contraction for 2009."

Tourism-related industries like hotels are likely to suffer as well.

"What we're finding out is that people are shifting the way they travel. Instead of travelling business they travel economy; instead of staying at a five-star hotel, they stay at a three-star hotel," Koldowski said.

Business travellers have become more prudent with entertainment expenses as well, he said, adding: "The longer the crisis goes, the tougher it's going to be."

Some analysts said the crisis could force a consolidation of the industry, but others argue that pride could get in the way of cross-border mergers for national flag-carriers.

Earlier this month, India's largest domestic airline, Jet Airways, struck an alliance with arch-rival Kingfisher Airlines involving code-sharing, ground-handling and route rationalisation to avert collapse.

Herdman of AAPA said a key factor in surviving the current crisis is a strong balance sheet because of the tight credit situation.

"In this environment, it's almost impossible to raise equity and the cost of debt is rising," he said. "The airlines best placed to survive are those with good cash reserves."


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## hkskyline

*Aviation industry is facing biggest crisis in its history amid fears of a global recession *
29 October 2008

PARIS (AP) - A three-day aviation industry conference opened Wednesday in Paris with some executives warning that the battered business is not likely to see brighter fortunes until 2010 at the earliest.

The World Air Transport Forum, uniting a variety of industry players, began as airlines are battling volatile fuel prices, tighter credit conditions and diminishing passenger traffic amid the global economic slowdown.

"We are facing probably the worst crisis our industry has ever faced," said Yanik Hoyles, British Airways' general manager for Europe. Others said conditions could worsen if recessions break out in North America and Europe, as expected.

Steve Ridgway, chief executive of Virgin Atlantic, said 2009 will be the "real telling year."

"We are not anticipating any kind of pickup until the summer of 2010 but who knows? It may not even be then," he said.

The outlook has changed dramatically since last year's World Air Transport Forum, when the industry expected to make a profit of at least $5.2 billion in 2008, said Pierre Jeanniot, the conference chair.

Now the International Air Transport Association is forecasting airline losses may exceed $5.2 billion this year.

The industry "is flying through the most threatening skies it has ever encountered and the storm is not over," said Jeanniot, a former CEO of Air Canada.

Traffic declined 2.9 percent in September from a year earlier, the first time since Asia's outbreak of severe acute respiratory syndrome in 2003 that global passenger traffic has shrunk, according to IATA.

A recent easing of global oil prices has brought relief to airlines but executives expressed fears that prices could be pushed back up. Oil prices have fallen by about 57 percent since peaking near $150 a barrel in mid-July.

Jeffrey Shane, a former U.S. Transportation undersecretary, said the crisis may require regulators to rethink rules prohibiting foreign ownership of national airlines and limiting slot availability at airports.


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## hkskyline

Friday, October 31, 2008
*Airlines seen facing winter survival battle *

PARIS (Reuters) - European airlines face a cut-throat battle to survive the winter as recession threatens the recipe many have used to ride out a spike in oil prices -- sharing the pain with consumers by slapping on fuel surcharges.

Airline bosses at a conference ending on Friday heard warnings that the slump in confidence after the banking crisis left no choice but to cut costs, merge or go bust.

"Consolidation will be very strong in coming months either through players merging or disappearing. That's overdue," said Air France-KLM Chairman Jean-Cyril Spinetta.

Delegates at the World Air Transport Forum said the only question was whether a major flag carrier would fold. Small Danish low-cost carrier Sterling this week joined a list of more than two dozen carriers that have gone bust this year.

"Everyone is saying I will wait for my colleague to collapse first, just to give me a bit of oxygen for a few months," said Marc Rochet, head of all-business-class airline l'Avion, recently swallowed by British Airways Plc .

Still, some airlines put a brave face on the crisis with upbeat growth targets, saying the rebound may be strong if they can hold on until 2010. One expert accused them of bluffing. 

"Nobody wants to be the first to give bad news. Everyone is lying to each other," Ralph Kaiser, head of corporate travel payments system UATP, told delegates.

Air traffic historically tends to grow at twice the level of gross economic product, but global international traffic fell in September for the first time in five years.

Industry icon Bob Crandall, the former American Airlines chief credited with introducing changes such as yield management, said the correlation between growth and traffic was unlikely to be re-established and the industry must brace for a long crisis.

"My prediction is the world's financial difficulties will be much worse than most of us think," he said.

DEBT CURE

Many airlines are losing money in an industry which, at the best of times, has rarely been able to generate fat margins.

"Those who come out will be those who enter the crisis with solid finances and low debt," Spinetta said.

Air France-KLM is vying with Lufthansa for a stake in rescued Alitalia, following a state spin-off of bad assets, and until recently was eyeing Austrian Airlines .

Alitalia , weeks away from running out of cash as it seeks to escape insolvency, received a lift on Friday when four unions agreed a conditional deal with local investor group CAI, assembled to rescue the Italian flag carrier. But doubts remained over whether unions would sign up.

Airlines were pummeled by record oil prices which peaked at around $150 a barrel in the summer before dropping back below $70.

Many imposed fuel surcharges, but the recent traffic drop and abrupt economic slowdown could bar their escape route.

"In July everyone said their costs were out of control. They were able to pass on fuel costs, but now it is not certain they will be able to and that is going to increase pressure," Bjorn Naf, chief executive of Bahrain's Gulf Air told the forum.

Long-term, unless oil collapses, the industry faces the challenge of persuading consumers to pay higher prices.

"We are in a hiatus and that is why there is so much drama going on in the industry," Virgin Atlantic Chief Executive Steve Ridgway told Reuters in an interview this week.

Although such price tags spell misery for Western airlines and consumers, airlines and airports from the oil-fired Gulf drew a contrast with growth in their region, saying it would be sustained by the diversification of their economies.

The head of Dubai Airports, Paul Griffiths, called the financial crisis a "blip" that will not deter the southern Gulf emirate from plans to build the world's largest airport -- covering twice the size of the territory of Hong Kong.

"People (in the global airline industry) will continue merging or go bankrupt and disappear. But Gulf carriers will keep growing and weather the storm," Gulf Air's Naf said.

Non-OPEC Bahrain, a relatively minor oil producer situated 30 minutes' drive from Saudi Arabia's wealthy Eastern Province, aims to carve a niche for its still loss-making airline with fast transit times. Three billion people can be reached in five hours' flying time from the Gulf using new planes, Naf said.


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## hkskyline

*Boeing sees global air cargo traffic tripling by 2027 *
4 November 2008
Agence France Presse

US aerospace giant Boeing forecasted Tuesday that global air cargo traffic would grow 5.8 percent annually over the next two decades, tripling an industry that has proved resilient to economic shocks.

"Air cargo traffic will grow over the long term despite current near-term market weakness and worldwide economic uncertainty," Boeing said, noting that the industry had shown strong recoveries from previous economic downturns.

"We've seen market contraction during the middle of this year for the first time since late 2003; however, history tells us that the air cargo market returns robustly when the economy strengthens," Jim Edgar, regional director of marketing at Boeing Commercial Airplanes, said in the statement.

The US company cited the Asian economic crisis in the late 1990s, the September 11, 2001 terror attacks in the United States, and the pneumonia-like Severe Acute Respiratory Syndrome (SARS) outbreak that killed almost 800 people in 32 countries in 2002-2003.

"Air cargo remains crucial to globalization," said Edgar, who also contributed to the company's biennial forecast, released at the International Air Cargo Forum and Exhibition 2008 in Kuala Lumpur.

Boeing predicted that air cargo traffic will have tripled by 2027, underpinned by long-term economic growth, freighter fleet renewal and moderating fuel prices.

According to the Boeing estimates, the global economy will grow "just higher" than 3.0 percent on average over the next 20 years, said Randy Tinseth, vice president of marketing, Boeing Commercial Airplanes.

"Asian production fundamentals -- including abundant raw materials and low-cost labor -- remain solid, and China will remain a source of strong economic growth with substantial industrialization and related investment," Tinseth said.

The Asian air cargo market growth was expected to continue to lead all global traffic routes, with domestic Chinese and intra-Asian markets expanding by 9.9 percent and 8.1 percent per year, respectively.

Between 2007 and 2007, Boeing predicted the worldwide freighter fleet would grow to 3,890 aircraft from 1,950. The biggest cargo planes, such as the Boeing 747 and 777, would account for 35 percent of the total fleet, compared with 26 percent currently, and transport 74 percent of the world's freight.

Boeing forecast that more than 75 percent of the 3,360 freighters joining the fleet -- 2,500 airplanes -- would come from passenger-to-freighter modifications as the industry grows.


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## hkskyline

*Brazil's Embraer cuts delivery forecast for 2009 *

SAO PAULO, Nov 8 (Reuters) - Brazilian aircraft manufacturer Embraer has reduced its delivery forecast for 2009 to 270 jets from a previous estimate of 315 to 350 planes.

Embraer also said in a statement late on Friday that it expects to invest a total of $450 million next year. In the first nine months of 2008, Embraer spent a total of $407 million in investments.

Earlier this week, Embraer said it has not received any order cancellations because of the global financial crisis, which has restricted the availability of credit and is slowing economic growth around the world.

But the company warned that the scarcity of credit would likely force some clients to request delays on delivery.

Embraer delivered 48 jets in the third quarter, compared with 47 in the year-earlier period and 52 in the second quarter of this year.

Embraer, short for Empresa Brasileira de Aeronautica, is the world's leading producer of regional jets seating up to 120 passengers. It also makes luxury business jets and military aircraft.


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## hkskyline

*Airlines could cut more flights 
Post-holiday travel falloff expected to be sharp *
11 November 2008
USA Today

More cuts in airline schedules may await travelers after the holidays -- there are early signs that the usual after-Christmas falloff in travel could be deeper than airline managers had expected.

With conventional fare sales and an overall 10% reduction in domestic flying capacity already in place for the December holidays, U.S. airlines aren't worried that the sliding economy will produce the kind of bah-humbug Christmas season retailers fear.

But come Jan. 5, when all the family vacationers, New Year's revelers and college football fans have gone home, and corporations' austere 2009 travel budgets take effect, all bets are off.

Signs of weakening demand:

*Continental Airlines last week sharply reduced its forecast for a key benchmark of revenue growth for November. It now expects a 4% to 6% increase from a year ago in revenue per seat per mile flown instead of growth in the "low to mid-teens." Continental is the only U.S. airline that publishes such a forecast, but history has shown it to be a reliable gauge of industry trends.

*A Southwest Airlines official says Continental's outlook conforms with her airline's. Tammy Romo, Southwest's vice president of financial planning, says trends have worsened in the month since the airline announced a 5% cutback in January flying capacity -- a big reversal for an airline that's grown steadily for 34 years.

"We have seen signs of weakness in our recent booking and revenue trends," Romo says.

*American Express, one of the largest corporate travel agencies, forecast three weeks ago that 2009 coach fares typically paid by business travelers could range from down 3% to up 5%, depending on the length and severity of the U.S. economic downturn. Now it looks like the lower end of that forecast will prove most accurate because business travelers increasingly are seeking cheaper fares aimed mainly at leisure travelers, says AmEx spokeswoman Tracy Paurowski.

So how will airlines react?

In the past they turned to widespread price cutting. But this year's fare and fee hikes, along with recent drops in fuel prices, put profits in sight in 2009.

During earnings conference calls with analysts and reporters last month, executives at several airlines hinted their bias is toward further capacity cuts if demand weakens more. Officials at Delta, now the world's biggest carrier, have dropped the strongest such hints.

"Managing your capacity is critical to controlling your revenues," spokeswoman Betsy Talton says.


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## hkskyline

*Thanksgiving air travel projected to fall-ATA *

NEW YORK, Nov 12 (Reuters) - The number of passengers traveling with U.S. airlines over the Thanksgiving holiday period will drop about 10 percent from last year as a weak economy hits consumer spending and carriers cut back flights.

Thanksgiving remains the busiest travel time for U.S. airlines, but the 2008 season will see a decline in passengers for the first time in seven years, according to the Air Transport Association of America (ATA), the trade body for the leading U.S. airlines.

The ATA said on Wednesday the number of passengers will drop from about 26 million to roughly 24 million over the 12-day Thanksgiving travel season from Nov. 21 through Dec. 2.

Thanksgiving itself is celebrated on Nov. 27 this year.

The trade association expects the three busiest travel days will be Sunday, Nov. 30; Monday, Dec. 1, and Wednesday, Nov. 26, respectively. Planes are projected to average close to 90 percent full on these days.

ATA Chief Executive James May said the weaker economy is hurting consumer spending and airlines have cut back their schedules in response to economic pressures.

This could help ease congestion. "With fewer flights operating, that should provide some relief to the air traffic management system," said May.

"Make no mistake -- the airports will be busy and many flights will be 100 percent full," added May.

The ATA said it is hoping the U.S. Government will once again open up military airspace to help further ease congestion.


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## hkskyline

*ANALYSIS-Business travel growth expected to slow in 2009 *

NEW YORK, Nov 13 (Reuters) - It's not quite the death of the salesman, but growth in business travel will likely slow down significantly in 2009 as cash-strapped U.S. companies cut back on unnecessary trips by executives.

The trend has worrying implications for U.S airlines, hotel and car hire companies, as well as the other industries that rely on the business traveler.

The National Business Travel Association (NBTA) remains reasonably optimistic, predicting that the number of business trips will continue to expand next year -- but at a slower pace than the annual growth from 2004 through 2007.

"This year we saw a slowdown in the growth of business travel -- in 2009. We will see a continuation of that slowdown," said NBTA CEO Kevin Maguire.

"In some companies, we are already seeing major cutbacks in travel, while other companies have higher travel budgets in place for 2009," said Maguire.

The NBTA said the tough economic conditions are forcing companies to change the way they think about business travel.

One big change is that traveling on behalf of a company will no longer be seen as a perk, Maguire said in an interview.

"Business is business -- do you send people on trips for purposes other than accomplishing business goals? Not any more," said Maguire.

"The economy is tough -- bottom lines are very, very important and the perk issue is really not a factor any more," Maguire said.

MEANER BEAN COUNTERS

The NBTA expects corporate bean counters to become even meaner in 2009.

Its research predicts company travel managers will step up cost-containment strategies by reducing nonessential travel and using data that allows them to access automated hotel information that flags out-of-policy spending.

Other companies will simply stop sending executives to meetings that involve travel costs.

"We are already starting to see companies cancel meetings and cancel participation in conferences," said Maguire. "You will see more companies go to webcasting and teleconferencing and videoconference. You can do a conference for much less than sending bodies to a meeting."

Some companies in the travel industry have already positioned themselves to limit their overall exposure to the slowing domestic economy.

U.S. airlines have increasingly been turning to international routes, which can often be more profitable. Delta Air Lines Inc is to add 15 new routes between the United States and what it called the world's fastest growing economies in Asia, Africa, Europe and the Middle East.

Starwood Hotels & Resorts Worldwide Inc , operator of the W, Sheraton, and St. Regis brands, last month reported lower quarterly profit and said it would slash costs and jobs and scale back capital spending.

However, Starwood was quick to stress that it derives about 55 percent of its management and franchise fees and 45 percent of its owned hotel earnings from outside the United States, positioning it better than some rivals.

HALF-EMPTY HOTELS

For hotel companies that do rely mostly on the United States, it could be a tough 2009.

Consulting firm PricewaterhouseCoopers expects that a key measure of the U.S. hotel industry's health, revenue per available room (RevPAR), will fall 5.8 percent next year, following this year's estimated 0.8 percent decline.

That would be the industry's first back-to-back decline in the widely watched measure since 2001-2002.

PwC said demand for hotels in 2009 is forecast to fall by 2 percent which, when coupled with an increase in supply, is expected to reduce occupancy levels to 58.6 percent, the lowest rate of occupancy since 1971.

What's more, the slowdown could put pressure on the corporate rates that hotel companies can charge for 2009.

Many corporate rates in hotels are negotiated a year in advance, so some companies may feel they are paying too much right now with prices negotiated when the economy was stronger.

That means current negotiations for 2009 corporate hotel rates have been tough, said hotel industry veteran Bjorn Hanson of New York University.

"Some (corporate) travel managers were saying, 'We paid too much in 2008, we want some of it back in 2009,' and others were saying '2008 is behind us, but we just want a very small increase for 2009.'"

Either way, it doesn't bode well.


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## hkskyline

*Asian airlines suffer rapid decline in passengers, cargo: AAPA *
25 November 2008
Agence France Presse

Asia-Pacific airlines are being hit with a sharp fall in passengers and cargo traffic as the global economic crisis bites, an industry group warned Tuesday.

The Association of Asia Pacific Airlines (AAPA) said passenger numbers slipped 4.1 percent in October, while air cargo demand slumped 11 percent.

"In recent months, Asia Pacific airlines have been facing a rapid decline in both passenger and cargo demand as a result of the global economic slowdown," said AAPA director-general Andrew Herdman.

The association said the average international passenger load factor for October fell 3.1 percentage points to 73.1 percent.

And despite a 7.5 percent reduction in cargo capacity, the average international cargo load factor for the month fell 2.6 percentage points to 65.4 percent.

"AAPA member airlines carried 119 million international passengers in the first 10 months of 2008, in line with last year, but passenger numbers are now falling," Herdman said.

"Airlines around the world are facing extremely difficult market conditions, with expectations of even tougher times ahead in 2009," he said.

"Asia Pacific airlines are moving quickly to adjust capacity in line with expected demand, and redoubling efforts to reduce costs throughout the business."


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## hkskyline

*IATA Warns Aviation In Critical Condition *
27 November 2008

LONDON (Dow Jones)--The International Air Transport Association (IATA) Thursday said international air traffic in October fell for the second consecutive month and warned the airline industry is in a dangerous condition.

International passenger traffic, or revenue passenger kilometers, declined by 1.3% compared to the same month a year ago, a smaller decline than the 2.9% drop in September.

IATA Director General Giovanni Bisignani said, "The gloom continues and the situation of the industry remains critical."

The October load factor, which measures how many of the airline's available airplane seats it filled with paying passengers, was 75%, about two percentage points lower than last year.

Whilst the drop in oil prices are a relief to airlines, Bisignani said, "recession is now the biggest threat to airline profitability. The slight slowing in the decline of passenger traffic is likely only temporary."

IATA cautioned the cargo market had not yet bottomed out. It said international air freight traffic contracted 7.9% in October, the fifth consecutive month of "increasingly severe drops."

"The deepening slump in cargo markets is a clear indication that the worst is yet to come," Bisignani added.

A sharp drop in Asia-Pacific exports impacted the regions' carriers as its international freight traffic fell 11%. The Asia-Pacific region accounts for 45% of the international cargo market.

Latin American carriers saw the largest decline of 11.4%.

But if carriers across the board were seeing a decline in passenger traffic, then European carriers were bucking the trend.They saw traffic move into positive territory with 1.8% growth in October.

Despite both the U.S. and European economies heading into recession, transatlantic traffic growth was flat for the month. But IATA said it expected further declines in international traffic for both regions' carriers.

North American carriers saw international passenger traffic decline by 0.8% in October compared to last year, slightly ahead of 0.9% drop reported in September.

Asia-Pacific carriers, which represent 31% of global international passenger traffic, saw passenger traffic fall by 6.1%, an improvement from the 6.8% decline reported in September. IATA said capacity reduction of 2.3% was not enough to keep pace with waning demand, and as a result load factors for the region's carriers fell to 72.2%.

Over the year, the weakest market for both intercontinental and regional travel was Africa. It saw the largest decline with international traffic dropping 12.9% in October. It is the only region where traffic weakened from September.

With the global economic downturn forcing the financial services industry to restructure, IATA urged a drive for efficiency.

Bisignani said, "Policy makers must also understand that change is needed in air transport. Unlike the finance industry, airlines are not asking for handouts. Commercial freedom, efficiency and a fair treatment in taxes are needed."

IATA represents some 230 airlines, comprising 93% of scheduled international air traffic.


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## hkskyline

*TABLE-U.S. airlines November traffic data *

CHICAGO, Dec 5 (Reuters) - The following table lists November mainline operational data for the 10 largest U.S. airlines by passenger traffic, compared with the same month a year earlier:



Code:


          ----Traffic----    ---Capacity---    --Load factor--
           RPMs   pct chg     ASMs  pct chg     pct     Change
American      9.53     -14.5    12.45     -9.3    76.6   -4.6 pts
Delta*        8.91      -4.9    11.50     -5.3    77.4   +0.3 pts
United        7.47     -17.0     9.71    -14.2    76.9   -2.7 pts
Continental   5.86     -10.7     7.53     -7.8    77.8   -2.6 pts
Northwest*    5.67      -7.4     7.08     -4.7    80.1   -2.3 pts
Southwest     5.26      -8.3     8.33     +0.4    63.2   -6.1 pts
US Airways    4.26      -6.9     5.48     -6.1    77.7   -0.7 pts
JetBlue       1.90      -7.8     2.51     -6.3    75.7   -1.3 pts
AirTran       1.33      -6.6     1.76     -7.1    75.8   +0.4 pts
Alaska**      1.40      -6.9     1.83     -6.8    76.7    0.0 pts

NOTES: Traffic is measured in billions of revenue passenger miles, the distance traveled by paying passengers.

Capacity is measured in billions of available seat miles, reflecting the number of seats available for sale and the length of the flights.

Load factor is the percentage of seats occupied by paying passengers and change is in percentage points.

*Figures for Delta and Northwest, which have merged, include data for regional affiliates.

**Alaska Airlines doesn't include unit Horizon Air.

All data are from the airlines.


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## hkskyline

*Financial crisis tipped to cut cost of air travel*
6 December 2008
Agence France Presse

The price of air tickets should start coming down soon because of the world financial crisis, experts are predicting, while ruling out a plunge that would endanger the health of airlines.

"If you keep prices too high you're going to lose more passengers," said Geoff van Klaveren, of Exane BNP Paribas, against a background of both companies and tourists cutting back on air travel.

Cut price airline Ryanair's boss Michael O'Leary forecast a reduction in an average ticket of between 15 and 20 percent by the end of March, and claims to be attracting passengers from more conventional companies like British Airways.

Most airlines nowadays use the yield management system, whereby prices are adjusted by computer on an almost daily basis in line with demand, starting relatively low then rising if a particular flight fills up, or falling if it does not.

"However, company profit margins are narrow, and they cannot really engage in a price war," commented Didier Brechemier, a consultant with Roland Berger.

Few airlines have yet adopted an aggressive pricing strategy, as they try to recover from the massive cost of fuel which neared 150 dollars a barrel in mid-July, forcing them to slap surcharges on tickets.

While oil has now fallen to a third of this level, companies have held back from price-cutting at the same rate, while from time to time announcing a reduction in the surcharges since September.

At the same time they have adopted other tricks to keep the money coming in, such as the introduction by the leading European airline, Air France-KLM, of a 50-euro charge on economy class seats located near the emergency exits, where passengers enjoy more legroom.

The same company is also introducing an extra class between business and economy which will come into effect towards the end of next year, and Brechemier predicted that others would follow suit.

"This project is perfectly matched to the crisis, and we are in a hurry to put it into effect," said Air France-KLM boss Pierre-Henri Gourgeon, noting that it would allow businessmen to continue travelling in reasonable comfort while saving money.

The global airline industry -- forecast to lose 4.1 billion dollars this year by industry body IATA -- is also fast consolidating in a bid to reduce costs by achieving economies of scale.

Last week, German airline Lufthansa announced a takeover offer for loss-making rival Austrian Airlines (AUA) and Irish low-cost airline Ryanair made a 748-million-euro cash offer for national rival Aer Lingus.

British Airways said Tuesday it was "exploring a potential merger" with Australian rival Qantas Airways as part of a broad tie-up.

BA is also in talks with Spanish airline Iberia and American Airlines.


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## hkskyline

*Airlines head for $2.5 bln global loss in '09 -IATA *

GENEVA, Dec 9 (Reuters) - Global airlines are heading for less drastic losses in 2009 than initially feared thanks to sharp falls in fuel prices but the industry remains in a "sick" state, the International Air Transport Association (IATA) said on Tuesday.

Overall revenues are expected to fall for the first time since 2002, with air cargo transport -- viewed as a barometer of the global economy -- declining more sharply than passenger traffic, the industry body said.

IATA scaled back its estimate for total losses in the sector next year to $2.5 billion from the $4.1 billion it had forecast in September, based on a reduced average oil price of $60 per barrel. It also trimmed expectations on 2008 losses to $5.0 billion from $5.2 billion.

But its 230 members, which represent 93 percent of scheduled international air traffic, still face a bumpy ride.

"The outlook is bleak. The chronic industry crisis will continue into 2009. We face the worst revenue environment in 50 years," said IATA Director General Giovanni Bisignani.

The "ferocity of the economic crisis" has overshadowed gains made from restructuring and greater fuel efficiency in recent years, he said. "The industry remains sick."

Passenger traffic is forecast to fall 3 percent next year, the first drop since 2001, while cargo is predicted to be 5 percent lower in 2009 after contracting an estimated 1.5 percent this year, according to the Geneva-based body.

Revenue is seen 6 percent lower at $501 billion, against an estimated $536 billion this year.

Air cargo traffic, which makes up 35 percent of goods traded internationally, is continuing its decline, Bisignani said.

Its 7.9 percent decline in October, the fifth consecutive month of increasingly severe drops, was a clear indication that "the worst is yet to come" for airlines and the slowing global economy, IATA said.

European member airlines are expected to post losses of $1 billion next year, ten times higher than in 2008, it said.

North America is expected to be the only region making a profit in 2009, but only some $300 million, less than 1 percent of members' revenue, it said.

"An early 10 percent domestic capacity reduction in response to the fuel crisis has given the (North American) region's carriers a head start in combating the recession-led fall in demand," IATA said in a statement.

Asia-Pacific carriers will see losses more than double to $1.1 billion in 2009 from an estimated $500 million in 2008. Airlines in the region, which accounts for 45 percent of the global cargo market, will be disproportionately hit by the decline in trade, it said.

Oil prices have tumbled from a peak above $147 a barrel in July to around $44 as the economic downturn has slashed demand.

The oil price fall is not fully reflected in the IATA figures because of hedging, according to IATA Chief Economist Brian Pearce.

Some of the benefits of lower spot prices for fuel were being delayed into 2010, as hedging means many airlines are locked into higher than spot prices, Pearce told reporters.

IATA's forecasts for 2009 were all based on an average price of $60 a barrel for oil for a total bill of $142 billion, some $32 billion lower than this year.

Asked about the impact on Boeing and Airbus sales, Pearce said: "I would think that some of these orders and deliveries are likely to be at least deferred and some cancelled."

Bisignani also forecast 300,000 to 400,000 job losses over the coming year in the aviation and travel industry, which IATA says employs some 32 million people worldwide.


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## hkskyline

*International air traffic slumps in Nov: IATA *
30 December 2008
Agence France Presse

Struggling airlines hit more trouble in November, with passenger numbers down and freight plunging by a "shocking" 13.5 percent, the worst drop since the September 11 terror attacks, IATA said Tuesday.

Profits at Asia-Pacific carriers, which saw the sharpest downturn in demand as the global economic crisis deepened, are expected to be "disproportionately" affected by the plunge in cargo traffic, the aviation industry group added.

"The 13.5 percent drop in international cargo is shocking ... By comparison, this is the largest drop since 2001, in the aftermath of September 11," IATA chief Giovanni Bisignani said.

International air passenger traffic in November was down 4.6 percent from a year earlier, marking the steepest fall in the past three months.

In October, passenger traffic was down 1.3 percent after a drop of 2.9 percent in September, the International Air Transport Association noted.

Asia-Pacific carriers were hurt most, with a 5.1 percent cut in capacity unable to offset a 9.7 percent decline in passenger numbers.

North American airlines saw traffic slump 4.8 percent, hit by "the near collapse of the investment banking sector and consequent reductions in business travel."

Even Middle Eastern airlines, which typically posted double-digit jumps in passenger traffic before the crisis, saw growth shrink to just 5.6 percent.

Meanwhile, international cargo traffic in November experienced its largest drop since the September 11, 2001 terrorist attacks.

"As air cargo (accounts for) 35 percent of the value of goods traded internationally, it clearly shows the rapid fall in global trade and the broadening impact of the economic slowdown," said Bisignani.

Freight traffic shrank 16.9 percent for the Asia-Pacific airlines which account for almost half of all air cargo carried.

"As freight accounts for a larger percentage of revenues for the Asia-Pacific carriers, fourth quarter profits for the region's carriers will be disproportionately impacted by the downturn in the global air freight market," IATA said.

Latin American, North American and European carriers also posted double-digit falls in freight traffic.

ABN Amro aviation analyst Sandy Morris described cargo traffic at the moment as "dismal," but he added: "I should imagine that we are probably somewhere near the bottom now."

Morris was also more upbeat about the passenger sector, saying that if domestic traffic was taken into account, then overall demand was "certainly weakening but not precipitously.

"The irony is that despite weakening demand, many airlines will be in better financial shape in 2009," he said, explaining that sharply lower fuel prices would more than compensate for fewer passengers.

Fuel prices skyrocketed as oil soared above 140 dollars in July before plummeting to around 40 dollars now as the global economic downturn saps demand.

IATA said earlier this month that it expects the industry to lose 2.5 billion dollars (1.9 billion euros) in 2009 due to the economic crisis after losses of some 5.0 billion dollars this year.


----------



## hkskyline

*European Air Traffic To Fall 3% In 2009 - Eurocontrol *
26 January 2009

PARIS (Dow Jones)--Air traffic in Europe is expected to contract by 3% in 2009 after being virtually flat in 2008, reflecting the general economic slowdown, according to a Eurocontrol press release.

With businesses and private travelers reining in their spending, especially in Western and Central Europe, airlines will be cutting back on capacity this year, after traffic - as measured by the number of flights - grew 3% annually on average over the last six years, the Brussels-based European air traffic management organization Eurocontrol said.

Last year, the number of flights in Europe rose just 0.1%, the slowest growth rate in five years. Eurocontrol said traffic fell steeply toward the end of last year, with a 7% drop in overall air traffic in December alone, and three-quarters of the European countries saw declines.

For all of 2008, Italy, the U.K. and Spain experienced traffic declines of 2.7%, 1.7% and 2.1%, respectively. Traffic continued to grow in Eastern Europe, however.

Low-cost airline traffic saw its first drop in 15 years, with 4,600 flights a day in November 2008, down 6.1% on year. Business aviation traffic in December was down 16% on year.


----------



## hkskyline

*Airlines face tough 2009 as freight collapses-IATA *

GENEVA, Jan 29 (Reuters) - International air freight traffic plunged 22.6 percent in December compared to a year earlier, an "unprecedented and shocking" free fall that signals a broader slump in world trade, industry data showed on Thursday.

The International Air Transport Association said airlines faced one of their toughest years ever, with cross-border passenger traffic dropping 4.6 percent year-on-year in December, even after a boost from advance bookings of holiday travel.

The data is also bad news for the broader global economy -- in value terms, a third of world trade is in goods sent by air.

"Keep your seatbelts fastened and prepare for a bumpy ride and a hard landing," warned IATA Director-General Giovanni Bisignani.

"The 22.6 percent drop in international cargo traffic in December puts us in uncharted territory and the bottom is nowhere in sight," Bisignani, previously chief executive of Air Italia, added.

All regions showed major declines in international freight traffic, according to IATA. Asia-Pacific carriers, who make up 45 percent of the air cargo market, were hit hardest.

"The collapse in the airline industry's freight business is a reflection of 20-30 percent declines in export and import volumes being reported across Asia, North America and Europe as the global recession plumbs new depths in December," it said.

$2.5 BILLION LOSSES LOOM

Global airlines are set to post $2.5 billion in losses in 2009 after suffering a $5 billion loss last year, according to IATA whose 230 member airlines account for 93 percent of scheduled international air traffic. Its figures do not include domestic traffic.

Its projections remain based on a fuel price of $60 per barrel, a decline of 3.0 in passenger volumes and a drop of 5.0 percent in cargo traffic.

They came a day after a gloomy outlook from the International Monetary Fund which sees the global economy at a virtual standstill, forecast to grow just 0.5 percent in 2009.

For the full year of 2008, international air cargo traffic was down 4 percent, while international passenger traffic posted modest gains of 1.6 percent, according to the Geneva-based body.

Despite year-end holiday travel, carriers struggled to keep pace with falling demand in December, when the passenger load factor fell to 73.8 percent, meaning one in four seats was empty, it said.

"Airlines are struggling to match capacity with fast-falling demand. Until this comes into balance even the sharp fall in fuel prices cannot save the industry from drowning in red ink," said Bisignani.

Business travel -- driven largely by international trade and services -- has slumped since the financial turmoil began in September. It shrank further in November with the number of passengers travelling on premium tickets dropping by 11.5 percent year-on-year, according to IATA data earlier this month.

Revenues from premium tickets are a key source of profitability for airlines.

IATA called on Thursday for major structural changes to the beleaguered industry whose revenues it said were expected to contract by $35 billion to $501 billion.

"We don't want bail-outs. But we need to change the ownership rules. Almost every other business has the freedom to access to global capital and the ability to merge across borders where it makes sense. To manage this crisis airlines need the same management tools," Bisignani said.


----------



## hkskyline

*Asian airlines trim down for expected hard landing *
1 February 2009
Agence France Presse

Asian airlines are cutting routes and taking other measures to avoid flying half-empty planes during a travel slump caused by the global economic crisis, analysts and industry players say.

With most projections saying the world economy will worsen before it starts to recover, airline job cuts could come next, analysts said.

Carriers are also expected to seek alliances and other forms of cooperation to ride out the turbulence whipped up by a global financial storm that originated in the United States, the world's biggest economy, they added.

"It's going to get worse before it gets better... and airlines are making preparations to try to ride this out," Standard and Poor's aviation analyst Shukor Yusof told AFP.

Singapore Airlines (SIA), one of Asia's major carriers, has announced the suspension of some international flights affecting routes to India, Southeast Asia, the United States and Europe.

In a sign that even elite passengers are feeling the pinch, SIA's non-stop, all-business class service to New York and Los Angeles will be trimmed to 10 flights a week from 14.

"We don't want to be flying half-empty planes around the world any longer than we have to, because it increases our cost burden at a time when we can least afford that," said SIA spokesman Stephen Forshaw.

Japanese carriers Japan Airlines (JAL) and All Nippon Airways said they were slimming down by suspending or reducing flights and switching to smaller planes.

JAL, Asia's biggest airline, said it was decreasing flights from Tokyo to New York, Bangkok and Seoul beginning in late March. It will suspend services from the western city of Osaka to London.

JAL also plans to reduce the number of seats on other routes such as Tokyo to Sydney, Chicago and Los Angeles by introducing smaller aircraft.

All Nippon Airways, the country's second biggest carrier, said it would stop using jumbo 747s on flights from Tokyo to Paris and Frankfurt later this year. It would also introduce smaller planes between Tokyo and Washington.

"2009 is shaping up to be one of the toughest years for international aviation," International Air Transport Association (IATA) chief Giovanni Bisignani said in his latest assessment.

"Keep your seatbelts fastened and prepare for a bumpy ride and a hard landing."

The Asia-Pacific region was the industry's booming market in recent years but international passenger traffic carried by the region's airlines fell 9.7 percent in December over the previous year, the sharpest decline in any region, IATA said.

Only carriers in Latin America and the Middle East saw an increase.

Asia-Pacific airlines, which account for 45 percent of global cargo, also registered the steepest fall in freight traffic, a 26 percent decline last month, said IATA, the industry's trade organisation.

This is worse than the 22.6 percent fall in cargo traffic worldwide, the IATA figures showed.

"I'm expecting the inevitable -- which is job cuts. It's looking more and more likely because of the degradation in the traffic numbers both for passengers and cargo," Yusof, of Standard and Poor's, said.

He said airlines would eventually have to deal with a surplus of wide-bodied aircraft made idle from a lack of passengers.

SIA has the option of selling, leasing or parking surplus planes, its spokesman said.

But SIA says it will push through with all its current orders, including 13 Airbus A380 superjumbos -- the world's largest passenger plane -- 18 A330s and 20 Boeing B787-9s, so that it can retire older aircraft.

In Australia, national airline Qantas grounded 10 aircraft and cancelled plans to lease two new planes in November. It halted all planned domestic growth for both Qantas and budget offshoot Jetstar.

Hong Kong carrier Cathay Pacific is also under severe pressure after passenger numbers dropped 0.3 percent year-on-year in December despite an aggressive marketing campaign, following a 2.2 percent drop in November.

Cathay Pacific's revenue manager Tom Owen said the airline had been forced to cut ticket prices to keep December figures respectable.

Cathay's cargo business has been hit even harder, dropping 23.9 percent year-on-year in December. The firm has delayed a new cargo terminal at Hong Kong International Airport by two years.

Taiwan's two major carriers, China Airlines and EVA Airways, said recently introduced direct air links to mainland China had cushioned the impact of the economic slump.

"The 22 weekly flights to major mainland cities are very profitable," China Airlines senior vice president Roger Han said.

For those less fortunate, one option is consolidation, the Centre for Asia Pacific Aviation consultancy said in an analysis.

It predicted that full-service airlines and some low-cost carriers "will attempt to forge new relationships this year", ranging from operational mergers to full equity transactions.

But it warned that most such attempts are likely to fail because the industry is heavily regulated.


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## Messi

there was a thread about monthy passenger traffic of airports. Does anyone know where I can find it?


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## deranged

^^ A European one is here.

If that's not the one, and the last post in the thread was more than a month ago, it may have been sent to the archives.


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## hkskyline

*Business-class air travel drops in December - IATA *

GENEVA, Feb 18 (Reuters) - Airlines sold far fewer business and first class seats in December, though economy travel in the Christmas period was buoyed somewhat by tickets bought before economic gloom set in, a global industry body said on Wednesday.

The International Air Transport Association said "premium" traffic was 13.3 percent lower in December than the same month in 2007, following the 11.5 year-on-year drop seen in November.

"This precipitous fall has been driven by the abrupt decline in business activity and international trade around the world," IATA said in its latest Premium Traffic Monitor.

Asia had the largest drop, with Far East flights filling 25.1 percent fewer top-tier seats compared to the year before, said the Geneva-based IATA, which represents 230 airlines including British Airways, Cathay Pacific and United Airlines.

Singapore Airlines, the biggest airline by market value, said on Monday it was cutting capacity by 11 percent in the year from April due to waning travel and cargo demand.

Overall, December premium traffic fell 8.8 percent in the North Atlantic region, 16.3 percent in Europe and 4.2 percent in the Middle East, according to IATA's data that excludes domestic flights.

Africa was an exception with 11.8 percent year-on-year premium traffic growth in December.

In economy class, the picture was less bleak. Some 5.3 percent fewer people took cross-border flights in December compared to the year before.

"Leisure trips at this time of the year may well have been pre-booked before the full extent of the recession was apparent, so an accelerated fall in economy travel numbers should be expected in January," IATA said.

"With jobs being lost at an increasing rate during January and consumer confidence falling further it seems that the bottom has not been reached for air travel and even weaker numbers may become evidence in the first few months of this year."

For 2008 as a whole, IATA said premium travel fell 2.8 percent while economy travel rose 0.9 percent.

Because economy tickets represent more than 90 percent of all tickets sold, overall passenger numbers on international markets flown by IATA airlines grew 0.5 percent last year.

Although sliding oil and jet fuel prices have given airlines some respite, IATA said weakening passenger and cargo demand has created new problems, causing both fares and yields to drop.

Premium tickets normally make up about 8 percent of total passenger numbers but 15 to 20 percent of revenues. IATA said airlines saw a 20 percent drop in premium revenues in December, which if sustained could cut 3 percent or $15 billion from the airline industry's annual revenues.


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## hkskyline

*Slump in air travel, cargo, accelerates: IATA *
26 February 2009
Agence France Presse

International air travel traffic slumped even further in January plunging the airline industry deeper into crisis, the industry association IATA reported Thursday.

Passenger demand fell by 5.6 percent in January compared to the same month last year, a full percentage point worse than the decline recorded in December 2008, the International Air Transport Association (IATA) noted.

The steep fall in air cargo also accelerated, demand dropping by an unprecedented 23.2 percent year-on-year in January, compared to a drop of 22.6 percent a month earlier.

"Alarm bells are ringing everywhere," IATA chief executive Giovanni Bisignani said in a statement.

"The industry is in a crisis and we have not yet seen the bottom."

"Every region's carriers are reporting big drops in cargo. And, aside from the Middle Eastern carriers, passenger demand is falling in all regions," Bisignani added.

Some of the decline was offset by cuts in flights, but the 2.0 percent cut in global airline capacity failed to keep up with the decline in air travel.

The biggest regional fall in passenger travel and air cargo again occurred in Asia, previously the industry's biggest source of growth in recent years.

Passenger traffic dropped 8.4 percent in January despite the traditional boost for the Chinese New Year, while air cargo in the region, the biggest global air freight market, fell 28.1 percent.

IATA said the prospects for passenger traffic in Asia this year "remain dismal."

North American carriers suffered a decline of 6.2 percent in passenger travel, largely due to the fall in demand on trans-Pacific routes, while freight fell 19.3 percent.

In Europe passenger demand fell by 5.7 percent last month, more than double the decline seen a month earlier, and freight fell 23 percent.

The Middle East was the only region to experience growing air travel, of 3.1 percent, but it was far below the double digit growth recorded by airlines based in the region last year.

Bisignani repeated criticism of additional flight taxes in Europe, especially while tax breaks were being lined up in other sectors to stimulate economic growth.

"Don't tax us to death in order to pay for investments in the banking industry," said the IATA's chief.

"This includes the UK government's plans to increase multi billion pound Air Passenger Duty and the Dutch government's misguided departure tax," he added.

IATA maintained a forecast of a 2.5-billion-dollar (1.9-billion-euro) loss for the industry in 2009.

The crisis is set to wipe 35 billion dollars off revenues, leaving airlines with a total of 500 billion by the end of the year, according to the association.

IATA groups 230 carriers covering more than 90 percent of scheduled international air traffic, with the exception of exclusively low-cost airlines such as Ryanair and EasyJet.


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## hkskyline

*Asian air cargo slumps 23.6 pct in January *
26 February 2009
Agence France Presse

Air cargo demand in Asia slumped 23.6 percent in January while passenger numbers dropped 7.8 percent, the Association of Asia Pacific Airlines said Friday.

"The collapse in world trade is having a severe impact on airfreight demand, forcing airlines to temporarily ground a number of dedicated freighter aircraft," association director general Andrew Herdman said in a statement.

"Passenger travel demand is also weak, with premium traffic particularly hard hit as businesses seek to cut costs in response to the global economic downturn."

The association said that the number of international passengers carried by its member airlines dropped 7.8 percent to 11.4 million in January 2009 compared to a year ago.

Average passenger load was down nearly five percentage points to 73.9 percent.

In the cargo sector, there was a 23.6 percent decline in international freight tonne kilometres in January compared to the same period a year ago, it said.


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## hkskyline

*Airline '09 losses to pass previous estimates-IATA *

KUALA LUMPUR, March 19 (Reuters) - The losses of world airlines in 2009 are likely to exceed the $2.5 billion forecast previously, as the global economic crisis eats up passenger and cargo traffic, an industry body said on Thursday.

"Our last industry forecast made in December was for a $2.5 billion loss in 2009 based on a 3 percent fall in passenger demand and a 5 percent demand in cargo," said Giovanni Bisignani, Director General and CEO of the International Air Transport Association (IATA).

"This is now looking very optimistic and next week we will issue a revised forecast," he told reporters.

IATA, which represents 230 airlines including British Airways, Cathay Pacific and United Airlines, said earlier this month world airlines lost up to $8 billion last year, far more than the $5 billion previously estimated.

In January, international passenger demand fell 5.6 percent year-on-year, following a 4.6 percent decline in December, according to IATA. February numbers are to be released next week.

Cargo volumes in January fell 23.2 percent year-on-year after December's 22.6 percent decline, the eighth consecutive month of contraction for freight traffic.

Bisignani said while economy travel demand has also slumped in response to the global financial crisis, a much faster decline in the premium segment, which airlines depend on for their bottom line, was hurting more.

"Business classes are empty. The airlines make money in the front and recover the cost on economy, and when the business class disappears, it's a big problem," he said.

Airlines around the world have been battered severely by the global financial crisis and have unveiled a slew of cost-cutting measures to stay afloat. Asian carriers have been worst hit.

Singapore Airlines, the world's biggest airline by market value, last week asked staff to take unpaid leave for up to two years in a bid to reduce costs.

The Singapore carrier, which last month announced plans to cut its capacity by 11 percent and has grounded 17 of its 100-plus aircraft, had already asked pilots at its cargo arm to volunteer for unpaid leave.

Cathay Pacific, the dominant airline of Hong Kong and Asia's fifth-largest carrier by market value, which reported a record $1 billion second-half loss recently, said last week it could sell some assets to raise cash.

Bisignani said he expected more capacity cuts by airlines across the world to adjust to slowing demand.

"You see further capacity cuts practically every week in different parts of the world. We have to try to adjust capacity to demand," he said.


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## hkskyline

*Airlines face losses of 4.7 billion dollars in 2009: IATA *
24 March 2009
Agence France Presse

Airline industry association IATA on Tuesday sharply increased its loss forecast for carriers to 4.7 billion dollars in 2009, which is set to be "one of the toughest years" that the sector has faced.

The new forecast, equivalent to 3.4 billion euros, by the International Air Transport Association marked a sharp rise from the 2.5 billion dollars in losses for 2009 that it predicted in December.

The industry group also raised its estimate of total airline losses for 2008 from 8.0 billion dollars to 8.5 billion dollars, blaming a "very sharp fall in premium travel and cargo travel."

"2009 is shaping up to be one of the toughest years that the airline industry has ever faced," said Giovanni Bisignani, IATA's director general, who also described the year as "grim."

While the forecast losses for 2009 were barely a fraction of the 13 billion dollars the industry lost in 2001 following the September 11 attacks in New York, Bisignani pointed to rapidly deteriorating revenues to stress the severity of the current crisis.

In December, the industry association forecast revenues would fall 35 billion dollars or 6.5 percent for 2009, but on Tuesday, it raised the loss to 62 billion dollars or 12 percent.

Bisignani called it a "shocking difference."

The industry is particularly hurt by the fall in premium traffic, or first class and business class seats, where airlines typically make their money.

Although the airline industry's prospects may improve towards the end of the year, "expecting a significant recovery in 2010 would require more optimism than realism," Bisignani insisted.

"Given the scale of this crisis and the impact on premium traffic and revenues, even with the best of optimism, I do not expect a significant recovery in 2010. This impact of this crisis will be with us for some time," he warned.

The only bright spot is falling fuel prices, noted Bisignani. Oil prices have plunged from a peak of over 140 dollars a barrel last July to around 50 dollars now.

However, some airlines anticipated that prices would continue soaring and therefore hedged or took out forward contracts based on the higher prices last year.

They are now paying elevated prices despite the fall, IATA explained.

Overall demand is projected to continue to slide this year, with passenger traffic shrinking by 5.7 percent over the year.

Asian-Pacific carriers are expected to be the worst hit, with the biggest losses to be posted by these airlines amounting to 1.7 billion dollars this year as demand tumbles 6.8 percent.

European carriers are forecast to post 1.0 billion dollars in losses while Middle East carriers are seen losing 900 million dollars.

Only North American carriers would post a profit of 100 million dollars, as they benefited from having trimmed capacity earlier and lower fuel prices, according to IATA.


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## hkskyline

*Air travel slump accelerates in February: IATA *
26 March 2009
Agence France Presse

The sharp decline in air travel accelerated in February as global passenger volumes nosedived 10.1 percent below levels recorded a year earlier, the airline industry association IATA said Thursday.

The double-digit fall in passenger demand was almost twice that of the 5.6 percent decline recorded for January, the latest data from the International Air Transport Association showed.

Airlines were unable to cut their capacity fast enough to keep up with the slump.

"The 5.9 percent reduction in capacity -- the most aggressive since the crisis began -- could not keep pace with the fall in demand," IATA said in a statement.

Freight traffic fell by 22.1 percent in February, in line with falls in December and January.

"Freight traffic, which began its decline in June 2008 before passenger markets were hit, has now had three consecutive months in the minus 22 to minus 23 percent range," IATA added.

Giovanni Bisignani, IATA's director general, said: "We may have found a bottom to the freight decline, but the magnitude of the drop means that it will take time to recover."

But even as freight traffic stabilises, airlines are now feeling the squeeze in passenger traffic.

Airlines in the Asia-Pacific region posted the sharpest fall in demand, 12.8 percent, as export-dependent economies cut back on business and leisure travel, particular those to long-haul destinations.

Capacity cuts of 7.8 percent were unable to make up for the drop in demand in the region, said IATA.

North American carriers posted a 12.0 percent drop, while European carriers saw traffic plunge 10.1 percent.

Latin American airlines lost 3.8 percent in passnger traffic, but that was closely compensated by cuts in capacity of 2.4 percent.

Only Middle Eastern carriers bucked the trend with a rise of 0.4 percent in international traffic.

IATA on Tuesday sharply increased its loss forecast for airlines to 4.7 billion dollars in 2009, saying it was set to be "one of the toughest years" that the sector has faced.


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## hkskyline

*Europe's airports report big drop in traffic *

GENEVA, April 8 (Reuters) - Europe's airport network rang alarm bells on Wednesday over the effect of the global recession on their business, reporting steep declines in passengers and cargo traffic since the start of the year.

The industry's regional body ACI-Europe said travellers passing through the continent's domestic and international terminals in January and February were down 12.2 per cent compared with the same period in 2008, and freight dropped by 23.7 per cent.

The figures were in line with similar falls in passengers and freight reported by international airlines and industry analysts said they showed how another, more community-based, branch of the global travel industry was suffering.

"The double whammy of falling aviation and commercial revenues is hitting Europe's airports more and more severely with each passing month," said ACI-Europe's Director General Olivier Jankovec.

"On top of that, the capital intensive nature of airports means that we are also being squeezed by the ongoing paralysis of capital markets," he declared in a statement issued from the body's Brussels headquarters.

ACI-Europe links 440 airports in 45 countries, from giants handling more than 50 million passengers a year to tiny businesses such as Mostar in Bosnia which processes only 9,000.

Among major ACI-Europe members are Britain's Heathrow, operated by BAA [FERBA.UL] a subsidiary of Grupo Ferrovial , Germany's Frankfurt, owned by Fraport , France's Charles de Gaulle, part of Aeroports de Paris and Russia's Moscow-Domodedovo, while its smallest members include Linz in Austria, Knock in Ireland, and Berne in Switzerland.

Airports around the world are closely tied to local economies, generating thousands of jobs and commercial activities in catchment areas, so a serious decline in their business can have a wide knock-on effect.

The growth in the past decade of smaller airports handling much of the booming budget airline and internal air travel sector in Europe and North America is credited with bringing prosperity to once less-favoured regions.

The Geneva-based Airports Council International (ACI) says that worldwide, domestic travellers passing through its members' facilities in February were down 10 per cent and international passengers down 11 per cent compared with the same month in 2008.

ACI, the industry's global body, says travellers taking international flights from airports throughout the world were down 11.3 per cent in February while domestic travellers declined by 9.4 per cent against February 2008.

International freight moved from world airports was down 23.5 per cent and domestic freight dropped by 12.4 per cent, according to ACI's latest figures. (Editing by Jonathan Lynn)


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## hkskyline

* Air trade slump highlights task facing G20 * 

PARIS, April 7 (Reuters) - Airlines are unveiling more evidence of the uphill task facing world leaders as they seek to kickstart moribund trade, with freight traffic plunging again in March and empty business seats adding to growing losses.

U.S. majors which have reported passenger traffic declines of up to 13 percent were joined on Tuesday by rivals including Air France-KLM. Europe's largest airline said it had carried 9.4 percent fewer passengers and 19.2 percent less cargo in March.

Annual comparisons are less dramatic when adjusted for the fact that the Easter holiday, traditionally a busy travel period in Christian countries, falls in April not March this year.

Yet airline traffic figures are in the spotlight because they provide crucial economic signals for March, for which official data is not yet available, just as the world's economic powers try to breathe some life into flatlining global trade.

G20 leaders agreed last week on a $1.1 trillion package to boost the economy including a $250 billion infusion of funds to unfreeze international trade, about half of which goes by air.

Shares in Air France-KLM on Tuesday fell up to 4 percent.

It was the fourth month in a row that the world's largest carrier of international freight, with operations balanced across the globe, has seen cargo bookings drop about 20 percent.

"It just goes to show foreign trade is going really poorly at the moment. We are expecting very weak (February) data for French exports and imports tomorrow," said Alexander Law, economist at French research consultancy Xerfi.

Air France-KLM also revealed a "significant deterioration" in passenger unit revenues in March, days after it abandoned hopes of making money in the just-ended fiscal year.

In Scandinavia, SAS said March passenger traffic fell 16.7 percent and Finnair said it was slashing ticket prices to try to fill its seats..

The Finnish carrier's March cargo traffic fell 17.5 percent.

Shares in SAS fell 7.3 percent and Finnair fell almost 6 percent. British Airways, which last week warned on profits as March traffic fell 7 percent, lost 2.7 percent.

GLOBAL SUPPLY CHAIN 

Tuesday's stream of data arrived after U.S.-based Delta Air Lines, the world's largest carrier after taking over Northwest, said overnight its passenger traffic fell 13 percent and cargo activity dropped by a whopping 35.5 percent in March.

Delta and Northwest together make up the third biggest domestic airline freight network, according to latest IATA data for 2007.

Out of sight from ordinary passengers, the amount of cargo in the belly of a passenger jet or on special transporters provides precious clues to the flow of unfinished goods in the economic pipeline -- a possible indicator for future activity.

Supply chains in the globalised economy mean exporters increasingly rely on imports of components or semi-finished goods, often from dozens of other countries.

In Europe, factories have resorted to selling from stored inventory, rather than producing more goods from imported parts -- for which trade financing is in any case hard to find.

While cargo volumes have plummeted since December as a result, economists say supply chains are so tight that activity could leap upwards again as soon as the economy begins to stir.

Whether that will signal a true recovery is less certain.

"On inventories, you're probably going to have a technical recovery at one stage; you do hit rock bottom and you can't get any lower," economist Law said.

"But it doesn't mean there will be a pickup in demand. It just means you've emptied out your warehouses and you've got to have a vital minimum to sell."

Data also coincided with signs that tourism is suffering after holding up relatively well compared with business traffic.

France said tourism, which accounts for 6 percent of its economy, fell 3 percent last year and will fall again this year.

France kept its spot as the world's top tourist destination with 80 million visits last year but there were fewer from Britain, Germany, the United States and Japan.

Germany's Air Berlin, which provides both charter flights and city links for businesses, said on Tuesday its March traffic fell 5.6 percent, sending its shares 7 percent lower.


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## hkskyline

*Mideast airlines March passenger demand rises - IATA *

DUBAI, April 28 (Reuters) - The Middle East was the only region where airlines saw any growth in passenger demand in March, the International Air Transport Association (IATA) said on Tuesday.

The 4.7 percent rise in international passenger demand, up from a 0.4 percent rise the previous month, "represented an expansion of market share" of Middle East carriers, IATA said.

Airlines in the region also increased capacity by 13.1 percent, it said, creating an imbalance in the market.

Earlier this year, IATA said that after several years of rapid growth, Middle Eastern airlines were likely to double their losses to $200 million in 2009 as they felt the pinch of the global financial crisis.

But many of the region's carriers have been reporting steady growth. Last month, Abu Dhabi-based Etihad Airways said it expected revenue to grow 24 percent to $3.1 billion this year as it takes delivery of 11 aircraft and boosts passenger numbers by adding at least six new routes.

Carriers elsewhere around the world saw passenger demand fall sharply in March. North American carriers posted a 13.4 percent decline in passenger demand, while European airlines suffered a 11.6 percent drop, IATA said. 

In Africa, passenger demand slipped 15.6 percent, and Latin American carriers saw a 5.9 percent fall.


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## hkskyline

*Airlines post traffic rises but gloom remains *

LONDON, May 6 (Reuters) - British Airways, Ryanair, and easyJet all posted passenger growth for April, but warned that Easter had provided a short term boost and the industry remained in the quagmire.

BA flew 0.9 percent more passengers in April than the same month last year despite a 17.7 percent slump in business travel, but admitted it was selling tickets at lower prices to fill its planes.

The company said its load factor -- a measure of how well it fills its planes -- rose 2.6 percent to 78.1 percent.

"We're sacrificing yield (prices) in order to keep volume," BA head of investor relations George Stinnes told reporters, adding that the airline had launched a 2-for-1 offer on business class tickets.

Low-cost carrier easyJet said earlier on Wednesday that April traffic rose 6.3 percent. Easter fell in March last year, inflating the April year-on-year figures.

It said bookings for the summer were about the same as last year, encouraging analysts, but remained cautious on the economy. A spokesman for founder and biggest shareholder Stelios Haji-Ioannou said he still takes the view that easyJet ordered too many planes for current market conditions and should continue to postpone deliveries.

Ryanair posted a 12 percent jump in April passengers while its load factor increased to 82 percent

"The low cost airlines continue to produce materially better numbers than full carriers. They are holding up while business-to-business traffic like premium or cargo travel is down," said Stephen Furlong, airlines analyst at Davy stockbrokers in Dublin.

British Airways shares were up 5.5 percent higher at 175 pence by 1507 GMT, while easyJet was off 4 percent and Ryanair was up 4.4 percent.

BA remains in merger talks with Spanish partner Iberia


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## hkskyline

*Air cargo slump near bottom, no sign of upturn-IATA *

ZURICH, May 27 (Reuters) - The slump in demand for air freight may have hit bottom, data from an airline industry body showed on Wednesday, but it warned there were no signs that a recovery was around the corner.

Air cargo demand tumbled 21.7 percent in April, the fifth consecutive month of a drop of more than 20 percent, but the pace of decline held steady, indicating that the worst of the downturn could be in the past, the International Air Transport Association (IATA) said.

"Freight remains at shockingly low levels. The worst may be over. However, we have not yet seen any signs that recovery is imminent," IATA Director General and Chief Executive Giovanni Bisignani said in a statement.

Demand for air cargo, a key barometer for the health of global trade, has dwindled as retailers have stopped ordering new stock due to the slump in consumer spending, while manufacturers have also curbed their production of new goods.

Air freight volumes are likely "to bounce along the bottom" until inventories adjust to more normal levels, IATA said.

Earlier this month, Bisignani told Reuters it would be necessary to wait another three or four months before it would be possible to tell if the situation was improving.

IATA, which represents 230 airlines including British Airways, Cathay Pacific and United Airlines, and Emirates, said international air passengers numbers fell 3.1 percent year-on-year in April.

IATA said earlier this month that passenger travel was likely to fall further and the number of people flying business and first class had fallen sharply in March, depressing fares and hitting airlines' revenues.

Privately-owned airline Virgin Atlantic warned on Tuesday the tough economic environment would make it "almost impossible" for airlines to make a profit in the current year.

The group also reiterated recent comments from rival British Airways that a slump in passenger numbers worldwide showed no signs of abating, making the current climate the toughest the industry has faced.

IATA has forecast that carriers are set to lose $4.7 billion this year as a result of the global recession that has shrunk passenger and cargo demand, after losses of around $8.5 billion last year.


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## hkskyline

*INTERVIEW-IATA to raise 2009 airline industry loss forecast *

KUALA LUMPUR, June 4 (Reuters) - Losses from the world's airlines will be worse than forecast this year and will cause a knock-on effect on suppliers, with Boeing and Airbus orders next year looking to be down 30 percent, the industry's top body said on Thursday.

International Air Transport Association (IATA) Managing Director Giovanni Bisignani told Reuters in an interview that the body would revise its forecast of $4.7 billion of losses at its annual meeting on Monday.

"We are going to revise them for the worse because the numbers we have seen in passengers and in freight are not showing any improvement," Bisignani said, adding that it would take 3-4 years before revenues recovered to pre-crisis levels.

The industry lost $8 billion in 2008.

"Freight has probably touched the bottom, it is minus 21 percent (year-on-year) since the last two or three months... but we do not see any kind of improvement. But the passenger (sector) where we generate 90 percent of our revenues is still roughly 10 percent down," he said.

Airlines carry 38 percent of the world's freight traffic and demand has been hit hard by the downturn that is expected to see global output fall by 1.3 percent, according to the International Monetary Fund.

While there has been a recovery in stock markets and in the oil price, this has not been matched by the prospects of a return to growth in the global economy, Bisignani said.

"We don't see any real recovery of the real economy... the goods traded around the world are still 21 percent lower," he said.

The price of oil recently hit a seven-month high of $69.05 and IATA's forecast of losses this year is based on oil at $50 a barrel. Oil at $50 a barrel would cost the airline industry $100-$120 billion this year, less than last year's $180 billion, IATA forecasts.

ORDERS TO DRY UP

According to Reuters estimates, some $500 billion of airline orders have been placed for this year. Difficulties in getting banks to finance purchases could see the number of planes delivered by Boeing Co and its European rival Airbus Industrie drop by 30 percent next year, Bisignani said.

"On the demand side (for planes), we have seen numbers dropping, in order to recover the same level of revenues we would take between 3 and 4 years, so probably there will be a shift in the need for capacity," he said.

The current downturn has hit carriers across the globe from wounded national giants like Deutsche Lufthansa and British Airways.

Even nimble budget airlines such as Ryanair which this week posted its first loss in 20 years thanks to a writedown on an investment in Aer Lingus, have cut fares in order to try to grow passenger numbers at the expense of national carriers.

Bisginani called for an end to sweetheart deals for some low-cost carriers which see them paying lower fees for airports, but rejected calls for a bailout of the airline industry.

"When an industry is losing billions and billions of dollars, we are not asking for bailouts, we are just asking, give us the opportunity to run this as a normal business and see if we are able to start making some money."

He said that a wave of industry consolidation would be unleashed if the U.S. ended ownership caps by foreigners on its airlines and said he believed the industry could create value for stockholders.

"The value chain shows that everybody makes money except the airlines. Manufacturers make money, make money in spare parts especially, airports make money because they run a monopoly service," Bisiginani said.


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## hkskyline

*Airline group IATA says weak economy, Easter shift, sent April premium traffic down *
16 June 2009

MINNEAPOLIS (AP) - More evidence emerged Tuesday that a bad economy pushes passengers to the back of the plane, as a trade group reported that traffic in the high-end airline seats fell 22 percent in April.

Revenue from those passengers fell even faster, down an estimated 44 percent from April 2008, the International Air Transport Association reported.

The number of travelers on coach tickets rose 0.3 percent in April, which IATA said was an improvement over a 6.9 percent decline for the first quarter.

IATA pointed out that Easter landed in April this year versus March last year. The shift probably cut into higher-priced business travel but boosted leisure travel, IATA said. The group estimated that the Easter shift accounted for 5 percentage points of the decline in April premium travel.

Drivers of air travel such as jobs growth and industrial production were still declining in most big economies during April, "which would suggest a floor for air travel has not yet been reached," the group wrote.

Air travel has become much cheaper in recent months, with economy fares down 15 percent and premium fares down more than 20 percent, IATA said. That's because airlines are discounting tickets to try to keep them from going unsold.

Premium traffic in Europe fell 33.6 percent versus April 2008. Premium traffic within North America was down 16.5 percent, and traffic from Europe to Asia fell 26.4 percent.


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## hkskyline

*Air cargo drops in May, recovery still far off-IATA*

GENEVA, June 25 (Reuters) - Demand for cross-border air freight dropped 17.4 percent year-on-year in May, suggesting international trade is still a long way from recovery, a global airlines body said on Thursday.

The International Air Transport Association (IATA) said that passenger demand fell a more modest 9.3 percent year-on-year in May, and repeated its view that for airlines, "this crisis is the worst we have ever seen".

"We have lost several years of growth and yields are under severe pressure. Airlines are in survival mode. Cutting costs and conserving cash are the priorities," Giovanni Bisignani, IATA's director-general, said in a statement.

The latest reading of international air traffic includes the first estimate of the impact of H1N1 flu on airline travel.

Mexican carriers saw their passenger traffic fall nearly 40 percent in May, compared to a 9.2 percent drop among all Latin American airlines, said IATA, which represents 230 carriers including United Airlines , Cathay Pacific , Emirates [EMIRA.UL] and British Airways .

U.S. airlines also reported weak demand to Latin American destinations affected by the newly-discovered virus which has now spread to a global pandemic, the figures show.

Air cargo is a leading indicator for world trade, and equity markets are watching it closely for signs of economic recovery.

IATA said the 17.4 percent drop is a relative improvement compared to the 21.7 percent year-on-year fall in April, but remains far from full health.

It said although manufacturers have begun to add to their product inventories in anticipation of an eventual economic rebound, "inventories remain 10 to 15 percent higher than normal in relation to sales levels, indicating that a significant recovery is not expected in the near term".

Passenger traffic demand is slightly stronger than the 11 percent drop seen in March, indicating "a floor may have been reached," but it also has a long way to go, said IATA, which has estimated airlines will lose $9 billion in 2009.


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## hkskyline

*IATA: May Air Passenger Demand Down 9.3% On Yr *
25 June 2009

LONDON (Dow Jones)--The decline in global passenger demand in air travel appeared to have reached a floor in May, the International Air Transport Association, or IATA, said Thursday, but warned airlines still face a long haul to recovery.

IATA said passenger demand fell 9.3% in May from a year earlier. Freight demand dropped 17.4%, an improvement from the 21.7% drop in April.

The 5.0% cut in capacity wasn't enough to keep pace with falling demand and passenger load factors fell to 71.2%, down from 74.5% recorded in May 2008, IATA said.

IATA said figures suggested a floor had been reached and added: 'Although the impact of the recession appears to be stabilizing, strong headwinds from debt and low asset prices are expected to weaken and delay any significant recovery.'

'We may have hit bottom, but we are a long way from recovery,' said Giovanni Bisignani, IATA's Director General and chief executive.

Bisignani said airlines had lost several years of growth, with yields under severe pressure.

'Airlines are in survival mode. Cutting costs and conserving cash are the priorities,' said Bisignani.

He criticized airport operators and air navigation service providers for $1.5 billion in cost increases seen so far this year.

'It's irresponsible in the best of times and a completely unacceptable abuse of monopoly position in a crisis,' said Bisignani.


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## hkskyline

*Small EU airlines say demand dropped 10 pct in first 3 months of 2009 *
26 June 2009

BRUSSELS (AP) - Europe's small airlines said Friday that passenger numbers dropped 10.7 percent in the first three months of the year as the economy downturn hit business and tourist travel.

The European Regions Airline Association said half of its member carriers -- which do not operate long flights across Europe or outside the continent -- saw fewer people fly, even airlines flying to Alpine ski slopes during high season.

Air Alps Aviation, which flys from Italy to Austrian resorts, posted a 44 percent drop in demand while Tyrolean Airways was down 11 percent.

Smaller airlines have boomed in recent years as the emergence of many low-cost carriers led to more people switching from road and rail to air travel.

Major European airlines reported a 9.5 percent drop in passenger numbers from January to March. Globally, airlines expect to lose $9 billion this year.


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## hkskyline

*IATA: 60 Airlines Post 1Q Net Losses Totalling $3B *
30 June 2009

LONDON (Dow Jones)--The International Air Transport Association, or IATA, Tuesday said that over 60 airline companies have already reported a net loss over $3 billion during the first quarter, adding that airlines are on course for a $9 billion loss for the year.

Those losses are mainly due to falling yields - average revenue per passenger - and total revenue, and were recorded before the recent rise in fuel prices.

Equity markets became more cautious on the airline sector during June, with the Bloomberg Global Airlines index falling 2% from May levels, which compared to a 0.9% rise in the FTSE Global All-Cap, IATA said.

IATA, which represents 230 airlines globally, said: "Market concerns are rising about the squeeze on airline cash flows being brought about by the substantial rise in jet fuel prices and the equally sharp fall in yields."

Tuesday, the front-month August light, sweet, crude contract on the New York Mercantile Exchange was at an eight month high at $73.38 a barrel.

Airlines continue to cut capacity, with available seat kilometers down 5% in May and available freight ton kilometers down almost 10%, but still can't keep pace with the falloff in demand.

Capacity cuts so far this year have been roughly half of the decline in volumes flown, IATA said, forcing both fares and yields to fall sharply in the last couple of months alone.


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## hkskyline

*European Airline Passenger Traffic Dn 8.3% In May *
10 July 2009

LONDON (Dow Jones)--The Association of European Airlines, or AEA, said Friday passenger traffic in May was down 8.3% and in the first half of June decreases were around 7.5% with falls of 5.5% in the second half.

MAIN FACTS:

-May Far Eastern traffic down 9.8%, North Atlantic 8.8%, and traffic in Europe down 7.9%.

-Overall seat-km in May 5.3% lower than previous year.

-May load factor down 2.4 points to 73.2%

-All but three of the 28 reporting airlines reduced capacity for May.

-Towards the end of June there were signs that load factors on European and North Atlantic routes had stabilised, although the Far East market remains very weak.


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## hkskyline

*European airlines see no signs of recovery *

PARIS/FRANKFURT, July 9 (Reuters) - Figures from Lufthansa , one of the world's biggest carriers of air freight, a key barometer of world trade, showed the airline slump continuing, while Air France-KLM braced for temporary lay-offs.

Continental Europe's largest airlines -- Lufthansa by market value and Air France-KLM by revenues -- were unable to point to significant signs of recovery in separate announcements on Thursday, though Frankfurt airport operator Fraport sounded a rare but still fragile note of optimism.

Germany's Lufthansa said shipments of cargo and mail fell 14.3 percent in June after 10 percent in May as a slump in economic activity continued to weigh.

"In the air freight sector ... the market environment remained weak in June," the German flag carrier said.

Passenger traffic retreated 5.2 percent in June, it said, though this was better than the 7 percent some analysts had feared, and an improvement on May's fall of 7.1 percent.

Cargo flows are under the spotlight as economists look for clues on physical trade movements. They have been hit both by economic weakness and a crisis over trade financing that G20 countries have promised to address by pumping in cash.

Just under half of international trade by value is shipped by air, according to airline lobbyists, and Lufthansa is the world's second-largest cargo network after Korean Air . When Air France and KLM, which merged in 2004 but still operate separately, are combined, they outrank Lufthansa.

FRAPORT MORE OPTIMISTIC

Fraport said it had become slightly more optimistic about 2009 after a slump in passenger traffic had eased in June.

It will release the figures on Friday.

In the United States, airlines saw steep declines in traffic in June, a sign that demand remains weak and that carriers are likely to post second-quarter losses.

Germany has been the world's biggest exporter of goods since 2003 but has been hit by a slump in exports this year.

In mixed economic data on Thursday, Germany said it might have already emerged from recession, but U.S. unemployment data failed to cheer markets. 

TEMPORARY LAY-OFFS

Air France-KLM Chief Executive Pierre-Henri Gourgeon told a shareholders' meeting the Franco-Dutch group may impose temporary lay-offs to cope with recession as it saw no signs yet of a recovery in travel demand. 

"Air France-KLM must remain competitive. I haven't excluded temporary lay-offs. We will watch very closely. These measures should allow us to avoid affecting employment," he said.

In May Air France-KLM said it planned 3,000 job cuts in the financial year to end-March 2010 through natural wastage.

The world's airlines lost more than $3 billion in the first quarter of 2009, airline lobby IATA said last week, maintaining its estimate for full-year losses of $9 billion.

Airlines say there is little way of knowing how business trends will develop in the second half of the year and are conserving cash or merging to survive, while a rebound in oil prices looks set to delay profits when the recovery happens.

At $61.7 per barrel on Thursday, North Sea Brent crude futures <LCOc1> have risen 56 percent since mid-February, but they are still less than half their peak of $146/bbl a year ago.

Merger talk was rekindled on Thursday when the chairman of Spanish airline Iberia stepped down and was replaced by proven dealmaker Antonio Vazquez.

Vazquez, who oversaw the sale of Altadis to Britain's Imperial Tobacco in 2007, could put new life into merger talks with British Airways , which have been bogged down for a year, analysts said. [ID:nL9627060]

Vienna airport operator Flughafen Wien said passenger traffic fell by 10.5 percent in June as traffic to eastern Europe declined by almost 20 percent.

The June decline was less severe than in the first five months of the year. Year-to-date traffic declined 12.7 percent.


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## hkskyline

*Running on empty*
4 July 2009
The Economist

ON JULY 1st Lufthansa finally took control of BMI, the second-biggest carrier at Heathrow airport. But the only person celebrating was Sir Michael Bishop. A fortnight earlier the 67-year-old entrepreneur had forced the German airline to honour a decade-old put option to add his 50% stake to the 30% it already held, albeit at a lower price: £223m ($368m) rather than £292m.

That the deal had to be imposed on Lufthansa, almost literally on the steps of the High Court in London, was a sign of the times. Until quite recently, the chance to acquire BMI’s 11% share of take-off and landing slots at Heathrow would have been enviable. In 2007 American airlines, eager to take advantage of new “open skies” rules, were paying up to £25m for each pairing of slots. But these days, faced with one of the most savage downturns in the history of a notoriously cyclical industry, Lufthansa is desperately trying to conserve cash and cut capacity to match plunging demand.

The airline recently warned that without fierce cost-cutting measures it would fail to make even an operating profit this year. In the first four months of 2009 its premium traffic fell by 15%, while traffic within Europe dropped by 37%. Blair Pomeroy, of Oliver Wyman, a consultancy, points out that the last thing Lufthansa needs just now is to spend precious money and management time trying to sort out a struggling, sub-scale airline such as BMI.

It shows just how bad things are if even Lufthansa, one of the world’s most powerful airlines, cannot see how to make money by bulking up at Heathrow, one of the most coveted bits of real estate in aviation. According to IATA, the trade body that represents most of the world’s airlines, the industry is on course to lose $9 billion this year. Although passenger volumes appear to have bottomed out and freight recently recorded a small increase, IATA’s boss, Giovanni Bisignani, fears that the worst is yet to come and that once the summer holidays are over the crisis will intensify.

The problem, according to Brian Pearce, IATA’s chief economist, is that “fares and yields are still collapsing” in most of the world because capacity cuts have yet to catch up with the fall in demand. Deliveries to airlines that ordered new planes near the top of the cycle are running at a rate of about 100 a month and will continue at that pace well into next year because the penalties for late cancellation are so high. It is also hard for airlines to mothball planes they are still paying for. American majors were able to slash capacity much faster than their European and Asian counterparts because many of their elderly planes were fully depreciated. In just a few months last year, United Airlines grounded nearly 100 of its elderly Boeing 737s.

Another anxiety is the price of jet fuel, which has risen by nearly 50% since the beginning of the year and by over 30% since early May. Mr Pearce says that his forecast assumes oil at $65 for the rest of the year—five dollars below the level it reached this week. Each extra dollar adds $1.6 billion to the airlines’ costs.

If cash continues to evaporate at its present rate, even the strongest airlines will need to raise money. But the price they will pay for it could cripple them for years. Even airlines with healthy balance sheets, such as American and Southwest, are having to pay 10-11% on secured debt. United offered a yield of 17% on $175m worth of debt issued last week.

Sir Richard Branson, the founder of Virgin Atlantic, has mischievously suggested that his old rival BA could go bust. Aviation analysts think that unlikely. But its chief executive, Willie Walsh, admits it is facing a “fight for survival”. In the last financial year, BA recorded its worst-ever loss: £401m, £331m of which was chalked up in the first three months of 2009. The airline was getting through £2.7m a day in February and had cash reserves of less than £1.4 billion at the end of March.

Usually, about 65% of BA’s profits come from its routes across the North Atlantic, most of it from passengers paying a £4,000 business-class fare to New York. So far this year, BA’s premium traffic is down by about 17%—hardly surprising when much of it used to come from deal-chasing bankers. Mr Walsh is right to be fearful, particularly if unions balk at his plans to cut 3,500 jobs and opt to launch a summer of strikes.

IATA’s Mr Pearce sees some signs of recovery in Asia. But he expects only a long, hard grind for airlines in Europe and America. European regional airlines, squeezed on one side by low-cost rivals like easyJet and Ryanair and on the other by the big network operators, such as Air France-KLM and Lufthansa, are especially vulnerable. Although overstretched by the acquisition of BMI and two smaller airlines, Lufthansa is strong enough to weather the storm better than most. But not as well as Sir Michael, who realised some time ago that the best way of making money from the airline industry was to leave it.


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## hkskyline

*Air groups: May freight down 20 pct, outlook grim *

BRUSSELS, July 10 (Reuters) - European airlines witnessed another bad month of freight volumes in May with few signs of an upturn, two aviation groups said on Friday.

"May was another catastrophic month for air freight, which posted a 19.8 percent decrease" year-on-year, said the Association of European Airlines, which represents 33 carriers including Air France-KLM and British Airways.

"Several AEA airlines have seen their cargo volumes cut by one third or more," it added.

The group said passenger numbers fell 8.3 percent in May compared with a year earlier, with preliminary figures for June indicating a slight improvement.

"There is no relief in sight, however, in the air freight market," it added.

Airports body ACI Europe said freight dropped 20.1 percent year-on-year in May at the 105 airports it surveyed, a slight improvement on April's 25.4 percent fall.

The group gave no figures for June, but its director-general Olivier Jankovec last month told Reuters he forecast 2009 freight would be down 16 percent on last year.


----------



## hkskyline

*Gloomy airlines see upturn at year end: IATA *
16 July 2009
Agence France Presse

Airlines have reverted to pessimism about business prospects and do not expect any improvement in international air travel until the end of 2009, IATA said on Thursday.

The global recession has been cited as the main reason for deteriorating demand, but the impact of the swine flu pandemic is also being highlighted by airlines responding to the International Air Transport Association's survey.

"The glimmer of optimism about financial performance for the coming 12 months seen in April's survey has faded as respondents, on balance, indicate further declines in profitability ahead," said IATA.

"Even the optimistic respondents don't see significant recovery before Q4 this year and others not until early 2011," it added.

The airline industry has been battered by the global recession. As businesses attempt to reduce costs, cut backs have been made in particular yo business travel.

IATA noted that premium traffic -- business class or first class travel where carriers typically make their money -- fell more in May than in prior months this year.

"Passenger travel numbers in May cast doubt on the view that a bottom to the travel decline has been reached," it said.

In May, premium traffic passengers fell 23.6 percent, compared to a fall of 22 percent in April, and a drop of 19.2 percent in the first quarter.

IATA noted that economy travel appears to be growing for Europe-Middle East and Middle East-Asian routes, but this could also reflect a shift of business travellers from premium to economy class.

The impact of swine flu also began to be felt in May.

IATA had earlier said that the H1N1 virus depressed air travel by about one percent globally in May.

The slump was particularly marked in travel within central America which indicated a 62.4-percent fall in May. Traffic between central and south America also plunged 46.7 percent during the month.

European and American airlines were more downbeat than carriers in Asia, which expect "stabilisation of profitability."

Meanwhile, IATA also warned of what it described as "de-globalisation" amid the crisis, as economic stimulus packages unveiled by governments focus spending on boosting domestic economies.

The association feared that these measures are being implemented at the expense of world trade and capital links, and could further hurt international travel.

"The deterioration in international air travel in, to and from Asia during May, despite recovering economies in the region, is a worrying sign of what is being called 'deglobalisation'," said IATA.

Overall international air passenger traffic fell 9.3 percent in May following a year-on-year decline of 3.1 percent in April, a month traditionally buoyed by holiday travel over the Easter period.

IATA added last month that airlines are expected to lose nine billion dollars this year, the worst slump the industry has ever faced.

Combined with the revised estimate that it lost 10.4 billion dollars in 2008, the industry now looks set to lose almost 20 billion dollars over two years.


----------



## massp88

Does anyone know where I might be able to find passengers numbers for city pairs? For example, if I wanted to find out how many people fly between Los Angeles and Frankfurt where could I find this out? Also, I am curious if there are stats on the size of markets to a particular area. For example, how many passengers a year is Los Angeles - Europe. In other words, how many people fly between LA and Europe in 2008. Thanks.


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## hkskyline

massp88 said:


> Does anyone know where I might be able to find passengers numbers for city pairs? For example, if I wanted to find out how many people fly between Los Angeles and Frankfurt where could I find this out? Also, I am curious if there are stats on the size of markets to a particular area. For example, how many passengers a year is Los Angeles - Europe. In other words, how many people fly between LA and Europe in 2008. Thanks.


These are usually very hard to come by. Airlines rarely post specific route figures. These seem to be very proprietary numbers.


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## Rohne

@massp88: In 2008 there were 237694 passengers flying FRA->LAX (960 take offs including the 2 weekly cargo flights) and 242508 flying LAX->FRA.
From the whole of Germany there were 363070 passengers on 1405 flights flying to LAX (passenger load factor 84,8%).
Between LHR and LAX (both directions) there were 131601 passengers in June 2009.

The numbers for Germany can be found at the Federal statistical office of Germany.
(Click "Details" at "Luftverkehr auf allen Flugplätzen - Fachserie 8 Reihe 6.2 - 2008" (should be the first entry), choose whether you want the data as pdf-document or xls-table, click on "weiter" and the download will start; the numbers for intercontinental flights can be found in chapter 4.2.2, 5.2 and 8.2)


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## hkskyline

*Mamas don't let your babies grow up to be airline bosses *
19 July 2009
The Toronto Star

The first decade of this new century is one that airlines will be eager to forget.

It has been marked by the 9/11 terrorist attacks, the SARS outbreak, skyrocketing fuel costs, the bankruptcy of five major North American airlines and the outright disappearance of the likes of Swissair, Canada 3000 and Jetsgo.

Yet it seems those setbacks weren't punishment enough for an industry hard-pressed to turn consistent profits even in the best of times.

Which these obviously aren't.

Last week, the International Air Transport Association (IATA), trade group for the world's major carriers, reversed an earlier prediction that the latest plunge in demand had bottomed out. Reacting to a further 9.2 per cent drop in May traffic, IATA now forecasts total industry losses of $9 billion (U.S.) this year on a likely 15 per cent decline in revenues.

To which Willie Walsh, CEO of British Airways PLC, shakes his head and says, "Too optimistic." BA, which posted a record loss of $615 million (U.S.) last year, is so determined to cut 4,000 positions from its workforce that it's prepared to take its first strike in a dozen years.

BA's survival is at stake, claims Walsh. For Calin Rovinescu, CEO of Air Canada since the ouster of his predecessor in April, at stake is averting a second trip through bankruptcy court this decade. Like its peers among large, so-called "legacy" carriers, Air Canada has cut capacity by abandoning routes and reducing frequency of flights.

But Air Canada, which lost more than $1 billion (Canadian) last year, finds that it cannot reduce capacity fast enough to keep pace with sharp declines in traffic. In the past year, Air Canada has cut capacity by 7.6 per cent. But in that time, passenger volume fell 9.1 per cent. Archrival WestJet Airlines Ltd. trimmed its available seats 2.5 per cent during that period. But demand has fallen 7.1 per cent.

The worst global recession since the Great Depression and the accompanying credit crisis have severely reduced volume in all price categories.

Penny-pinching corporate clients have been grounding their employees, using teleconferencing wherever possible. The leisure market has also taken a hit as blue- and white-collar unemployment soars across North America and Europe.

Even workers who remain employed are sufficiently fearful of job loss they're opting for "staycations" rather than flying to Disney World or Vegas.

Fuel costs have dropped this year, of course, but they remain far above 2006-07 levels. Even swine flu and a recent string of airline tragedies have given travellers more reason not to fly. (So far this year, there have been about 630 plane-crash fatalities, more than in all of 2008, though well short of the 1972 record of 2,374.)

BA chair Martin Broughton, who calls the past 12 months an "annus horribilis" for BA and other global carriers, says his industry is "crying out for consolidation."

And it's true that despite all the capacity reductions, there still are too many planes chasing too few passengers.

BA is doing its part with drawn-out negotiations to merge with Spanish flag carrier Iberia Lineas Aereas de Espana SA, and BA hopes later this year to add American Airlines in an alliance among the three carriers.

Deutsche Lufthansa AG, having absorbed the short-lived successor to the failed Swissair, is close to a deal to buy Austrian Airlines.

Air France-KLM Group continues its long flirtation with a chronically profit-challenged Alitalia SpA. Yet even after last year's combination of Delta Air Lines Inc. and Northwest Airlines Inc., the U.S. market remains over-served by six national carriers, along with scores of regional players and upstart discounters such as JetBlue Airways Corp. and AirTran Holdings Inc.

With its heavy debt load and fractious labour relations, United Airlines Inc. seems the likeliest candidate to sacrifice its independence.

Yet even if the industry's consolidation wishes are fulfilled, commercial aviation will still suffer the curse that economists refer to as "low barriers to entry."

Starting an airline is notoriously easy: You just rent or lease one of the hundreds of aircraft mothballed in the Mojave and you're in business.

No sooner do failed carriers such as Jetsgo make their last trip to the hangar than appear the likes of privately held Porter Airlines, based at Toronto's Island airport. Porter goes head to head with Air Canada on the busy Toronto-New York run. (Porter flies to Newark, N.J., one of the Big Apple's three major airports.) Just three years after its launch, Porter counts eight destinations, with a business plan calling for an eventual 17 ports of call.

And U.S. upstart JetAmerica, with a leased Boeing 737, will next month begin offering $9 (U.S.) flights from its Toledo base to Newark, and will also commence service to the sub-metropoli of Melbourne, Fla., Lansing, Mich., and South Bend, Ind. The Jet

America plan is to profit from a raft of "convenience fees" for checked baggage, ordering tickets by phone ($20 U.S.) or Internet ($10 U.S.) and round-trip assigned seats ($20 U.S.).

Upstarts are the curse of the industry, driving down fares enough on cash-cow routes to impoverish larger carriers that rightly fear losing market share if they don't match the lowest fare on offer. Trouble is, these legacy carriers are operators of high-cost networks, vying for passengers with low-cost startups.

It's not as though the established players can be credited with unerring discipline.

Calgary-based WestJet last week unveiled expansion plans for 11 new destinations in the U.S. and Caribbean for next winter. Air Canada, which Bay Street expects will lose money this year and next, making for three consecutive years of red ink, plans to add capacity on major routes in peak periods, citing its London-Vancouver run during the Winter Olympics in February as an example.

"Adding flights at this point in the economic cycle takes courage, believe me," Rovinescu told a Vancouver audience gathered for the unveiling of an Olympics-branded Boeing 777 last week.

Courage probably isn't the word for it. Air Canada needs $600 million (Canadian) in financing to stave off insolvency.

Already the world's 14th-largest carrier, with more than 330 aircraft, what Air Canada needs is a thorough restructuring to get its costs down to within shouting distance of WestJet's.

"In the interim," airline analyst Fadi Chamoun of UBS Securities told Canadian Press last week, "equity holders will likely bear the brunt of the costs related to securing sufficient cash resources to bridge the liquidity gap until the economy recovers."

Air Canada shareholders have already suffered an 80 per cent drop in the value of their shares over the past year.

We need Waylon Jennings and Willie Nelson to reprise their 1978 hit "Mamas Don't Let Your Babies Grow Up to be Cowboys." The vocation you want to steer them clear of is airline executive.

"This industry is always in the grip of its dumbest competitors," Robert Crandall, long-time CEO of American Airlines, once complained.

"We have no choice but to match whatever low fare anybody puts out there.

"And so it will get as bad as they want it to get."


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## hkskyline

*Air traffic falls 7.2 pct in June, hit by swine flu: IATA *
30 July 2009
Agence France Presse

International air passenger traffic fell by 7.2 percent in June over 12 months, with the swine flu pandemic adding a blow to an airline industry already depressed by the economic crisis, IATA said on Thursday.

"These are extremely challenging times for airlines. There are no signs of an early economic recovery," said Giovanni Bisignani, director-general of the International Air Transport Association (IATA).

"Other external risks are potentially great, including rising oil prices and the impact of Influenza A(H1N1) on demand," he added.

IATA estimated that the effects of swine flu shaved up to four percentage points off growth rates for Asian-Pacific carriers in June, when a 14.5-percent fall was reported compared to the figure for the same month a year ago.

Latin American airlines posted a 4.7-percent drop in passenger demand, but this is "significantly better" than the 9.2-percent plunge in May, said IATA.

IATA said there were "early indications" that the Latin American region was beginning to recover from the impact of swine flu but pointed out that there was "still uncertainty around the spread of Influenza A(H1N1) and its effect on travel."

North American carriers also saw the sharp decline in traffic ease in May, with demand falling just 6.7 percent in June compared to 10.9 percent in May.

European carriers meanwhile posted a fall of 7.1 percent, compared to the May drop of 9.4 percent.

IATA said that even though the sharp decline in demand slowed in June compared to the rate in previous months, airlines had not reduced their capacity to match the fall.

"As a result, June revenue on international markets fell by a shocking 25-30 percent," it said.

Meanwhile, international air cargo traffic was down 16.5 percent, a 13th month running of contracting demand.

"There has been some improvement in world trade and, after adjusting for seasonal fluctuations, freight volumes rose six percent from the low point recorded in December 2008," IATA said.

At the current pace, air cargo traffic would take "several years" to return to early 2008 levels, it added.


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## hkskyline

*Aviation crisis? What crisis? Budget carriers flourish amid economic gloom *
5 August 2009

KUALA LUMPUR, Malaysia (AP) - Budget airlines have found a silver lining in the global recession.

As travelers pinch pennies and opt for cheaper alternatives, AirAsia, Europe's Ryanair and other low-cost carriers are adding routes and buying new planes to grab a larger slice of global aviation at the expense of their more established rivals.

Major players such as British Airways and Hong Kong's Cathay Pacific Airways have reported full year losses for the first time in years despite cutting costs and flights to cope with a downturn in premium air travel.

Full service carriers, which once completely dominated the skies, are banking on an economic recovery to restore their fortunes but they may find it tough to return to the growth levels they enjoyed before the crisis.

"Full-service airlines have a bit of conundrum on their hands," said Derek Sadubin of the Sydney-based Center of Asia Pacific Aviation. "We think low-cost carriers will become so much more entrenched in airports and corporate travel that it will be difficult for them to claw their business back" when the economy recovers, he said.

To be sure, all airlines have struggled as oil prices soared in the last two years. Oil prices have since tumbled and despite a rally early this year, are still half the level of a year earlier.

But major industrialized economies continue to contract and economic conditions are likely to remain tough even when a recovery is under way. The International Air Travel Association in June predicted airline losses worldwide to swell to $9 billion this year, nearly double its previous forecast.

Full service carriers are the worst hit as the downturn has hammered business and first-class travel, which make up a small percentage of seats but account for up to 40 percent of their revenues.

Their smaller, no-frills rivals are weathering the recession better with a low-cost model that relies on high passenger volumes, stripping out costs through strategies such as taking the cheapest landing slots at airports and turning full service features like meals and check-in baggage into profit-making extras.

In Asia, budget aviation has seen exponential growth since the start of the decade and now has a 16 percent market share, Sadubin said.

The market share of low cost carriers could cross the 20 percent mark in the next one to two years, he said, as they open up new routes across the region and give travelers an option to fly at a fraction of the cost charged by full service airlines.

Malaysian-based AirAsia, the biggest low-cost carrier in the region, posted a record profit of 203.2 million ringgit ($56.4 million) for the quarter through March, up 26 percent from a year earlier. Passengers soared 21 percent to 3.15 million during the period while falling at regular airlines.

It has ordered new planes, made its debut in Europe with flights to London in March and is eyeing plans to enter the U.S. market.

"We are in the McDonald's, Wal Mart category. Business is booming as people are looking for value," AirAsia Chief Executive Tony Fernandes told The Associated Press in a recent interview.

AirAsia's success has generated rivals, the best known of which are Singapore-based Tiger Airways and Qantas Airways-owned Jetstar.

Tiger, which is 49 percent owned by Singapore Airlines, is rapidly expanding and has a total 56 new aircraft on order for delivery through to 2016. Tiger expects business travel to account for 15 percent of its total traffic by March 2010, more than triple from current levels.

Budget aviation has put down even stronger roots in the U.S. and Europe, with about a one-third market share in both regions, analysts said.

In Europe, Irish discount airline Ryanair remained on an expansionary course and forecasts a net profit of up to 250 million euros ($350 million) for its 2010 fiscal year. It is eyeing plans to order up to 300 more aircraft in a deal that would make the Irish carrier more than double the size of British Airways.

In the cash-rich Middle East, analysts said budget aviation penetration is still low at less than five percent but new carriers have sprung up in recent months. FlyDubai, based in the United Arab Emirates, was launched in June and has unveiled ambitious expansion plans after ordering 50 Boeing 737 aircraft.

The intense competition from budget carriers has changed the rules of the game for some major airlines.

Many full service carriers are regularly churning up promotional offers -- with tickets at a discount of up to 80 percent -- in an effort to protect their market share.

Others like India's Jet Airways, Korean Air, and Malaysian Airlines have set up low-cost offshoots, relying on a two-brand strategy to cushion earnings.

Some carriers have taken more drastic steps to focus on lower-fare volume business.

British Airways has announced it won't configure any new planes to offer first-class cabins. Qantas has also scrapped first-class service on several long-haul routes and is considering reducing the 72 business seats in its Airbus A380 superjumbo jets.

But Singapore Airlines, one of Asia's top carriers, remains confident of a recovery in the premium market. It has cut fares and capacity this year but said it would not crop the 60 business seats in its A380 planes.

"It's a cyclical business and positive growth will return. We are not going to fundamentally change our business focus overnight just because of the downturn," said spokesman Nicholas Ionides.


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## hkskyline

*Association Of European Airlines: June Traffic Dn 6.5% On Year *
10 August 2009

LONDON (Dow Jones)--The Association of European Airlines Monday said traffic fell 6.5% on year in June, an improvement from the 8.3% decline in May, but added that the market remains weak.

Seat capacity, measured as available seats per kilometer, fell 4.9% on year and was consistent with reductions airlines made in May, said the AEA, which represents 33 European airlines.

Although carriers reduced frequency, the AEA said the rate of reduction "still didn't match the weakening market," and as a result load factor - which measures how many available seats are filled with paying passengers - fell 1.3 percentage points to 77%.

AEA said the hardest-hit market was for flights between Europe and the Far East, down 10.7% - the first double-digit traffic decline for flights between these regions since the SARS epidemic of 2003.

However, preliminary data show that traffic declines have eased in July - usually a peak time for summer travel - by 2.2% on year.

Capacity reductions slowed compared with May and June to 3%, but the AEA said the reductions were "at last sufficient to counteract the market decrease and drive a small improvement in load factor."


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## hkskyline

*Fragile air traffic recovery under way - IATA *

GENEVA, Aug 27 (Reuters) - A recovery in air traffic is under way, according to latest data from a global industry body, in another sign the world economy is clawing its way out of recession.

But the recovery will be "volatile and weak", the International Air Transport Association said on Thursday, indicating the turbulence that has buffeted an industry facing another year of multi-billion dollar losses is not at an end.

Airlines carried 11.3 percent less cargo and 2.9 percent fewer people in July than a year earlier, IATA said in its latest monthly reading of cross-border traffic, a leading indicator for the health of world trade.

The figures represented an improvement from June, when the year-on-year declines were 16.5 percent for cargo and 7.2 percent for passengers.

Air freight is a good leading indicator of world trade movements, since shippers tend to switch to air when speed is more important than cost -- at the start of an upturn -- and switch to ocean transport in a recession, IATA says.

As a result, air freight is first into recession but usually is first out, it said in a recent analysis.

So far this year, freight volumes have fallen 19.3 percent and air travel is down 6.8 percent, according to IATA, whose data exclude domestic flights.

And compared with June and adjusted for seasonal factors, both freight and passenger travel grew by more than 3 percent in July, it said.

"The data can be rather volatile but this does confirm earlier signs that a recovery in demand for air transport has begun, though there are good reasons for expecting the path of further recovery to be volatile and weaker than recoveries from previous recessions," IATA said.

IATA said there was a varied regional pattern, with passenger traffic in the Asia-Pacific remaining weak but improving, with a strong rebound in air freight reflecting recovery in several Asian economies.

Airlines in Europe and North America are seeing less improvement in freight, but a stronger improvement in passenger volumes which could reflect earlier cuts in fares.

Passenger capacity was more in line with demand in July, with passenger load factors averaging 80.3 percent, but excess capacity continued to emerge in the freight sector, it said.

"Downward pressure on freight rates and revenues continues to increase," said the Geneva-based body, which represents 230 carriers including British Airways, Cathay Pacific, Emirates and United Airlines.

IATA has estimated airlines will lose $9 billion in 2009 after an $8.5 billion loss in 2008, when high oil prices hit profits and then the global credit and financial crisis slashed demand for business and leisure air travel.

IATA estimated last year that $3.5 trillion of goods were transported by air in 2006, representing 35 percent of international trade.


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## hkskyline

*Airlines lost more than $6 bln first half '09-IATA*

GENEVA, Sept 1 (Reuters) - The world's airlines are being squeezed even as the global economy recovers, with higher oil and jet fuel prices causing added pain, an industry group said on Tuesday.

Net losses continued to expand in the second quarter of 2009, reaching at least $6 billion for the first half of the year, the International Air Transport Association (IATA) said.

In its latest financial monitor, it said the second quarter of 2009 involved "further deterioration" for airlines' bottom lines. Big carriers normally take in half their annual profits in the season that includes the northern hemisphere summer.

"This year Q2 losses of $2 billion follow Q1 losses of $4 billion," IATA said in a statement. "Total industry losses in the first half of 2009 are likely to have been in excess of the reported $6 billion.

IATA has previously estimated airlines will lose $9 billion in 2009 after an $8.5 billion loss in 2008, when high oil prices hit profits and then the global credit and financial crisis slashed demand for business and leisure air travel.

The Geneva-based group, whose 230 member airlines fly some 93 percent of international air traffic, also said that signs of economic rebound had pushed up energy prices in August, with jet fuel prices above $80 a barrel.

While air cargo volumes and passenger numbers rose in July, improving from their credit crunch and recession lows, IATA said "both remain well below levels seen at the same time last year."

"There was a material improvement in July but the future path is likely to be volatile and weaker than normal recoveries," it said.

IATA, whose members including British Airways, Cathay Pacific, Emirates and United Airlines, said last week that declines in cargo and passenger traffic in July were less than in the previous month.

The industry's recovery was under way but will be "volatile and weak", it said.


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## hkskyline

* Global air travel may not recover until 2011 *
9 September 2009

HONG KONG (AP) - International air travel, whacked by the economic downturn, is starting to stabilize but may not recover until 2011 as companies and passengers continue to scale back, executives at aviation giants Boeing Co. and Airbus SAS said Wednesday.

Passenger travel, somewhat better so far in the second half of 2009 than in the first, was still expected to slump between 6 percent and 8 percent for the year, said Randy Tinseth, a Boeing vice president for marketing.

Still, there were signs the drop in demand was slowing, with global airlines beginning to restore capacity and the Chinese and Latin American markets picking up, he said.

"We're already starting to see some improvements in traffic and traffic growth, but we've got a long ways to go," Tinseth told reporters at an Asian aerospace and aviation show in Hong Kong. "We see 2010 as a year of economic recovery and 2011 as a year of air travel recovery."

Airlines have racked up massive losses since the global economic crisis led companies to curb travel and shipping and consumers cut back on trips. Carriers, their losses already $6 billion in first six months of the year, are set to lose a total of $9 billion for all of 2009, according to the International Air Transport Association.

Boeing rival Airbus, the world's largest manufacturer of commercial planes, said air traffic seemed to be in the process of bottoming out and was slightly more optimistic.

Global air traffic -- measured by a combination of revenues, passengers and distances flown -- could slide between 2 percent and 4 percent this year, but then turn flat or grow as much as 4 percent next year, according to Laurent Rouaud, the aircraft manufacturer's senior vice president for market and product strategy.

In 2011, traffic could grow over 6 percent, he said.

Asia, where major economies like China and India are still expanding fast despite severe contractions in the West, was likely to lead the recovery. The region's air traffic may be up 4 percent this year and at least 6 percent in 2010, he said.

Boeing's Tinseth said Asia is set to overtake North America as the world's largest air travel market over the next 20 years, growing from its current 32 percent share to 41 percent.


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## hkskyline

*Boeing sees return to cargo traffic growth next year *

HONG KONG, Sept 9 (Reuters) - U.S. aerospace giant Boeing Co expects global air cargo traffic to return to growth next year amid a broad economic recovery, with the United States and China leading the way, a senior executive said on Wednesday.

Air cargo growth typically leads economic and passenger traffic growth by 3-6 months, Jim Edgar, Boeing's regional director, cargo marketing, said at the Asian Aerospace Expo in Hong Kong.

"This year, we're anticipating a deeper decline and it'll be the first time in history that we'll have two years of decline back to back," Edgar said, referring to worldwide cargo traffic.

"The decline is slowing ... things are improving and we're hopeful, but there's a way to go yet," he said, adding that near-term certainties include the global economy, oil prices and the stability of financial institutions.

Generous stimulus packages from governments will prop up the global economy, Edgar said.

"We expect the U.S. and China to lead the worldwide recovery, followed by the EU, UK and Japan," he said.

Air freight, a leading indicator of the health of world trade, is picking up slowly, but is still down on last year and the upturn remains fragile, the International Air Transport Association (IATA) said last week.

Airlines carried 11.3 percent less cargo in July than a year earlier, according to IATA data.

Boeing, like its European rival, EADS' Airbus unit, has had a difficult year as carriers and air cargo operators have seen less business during the global recession.

The road to recovery for the airline industry still looks bumpy for the current second half, said Randy Tinseth, vice-president of marketing for Boeing Commercial Airplanes.

"We're going into the worst part of the year -- it'll be a pretty tough next 4-6 months," Tinseth said. "But in 2010, there'll be a bounce back in traffic."

On Tuesday, Airbus said it was seeing signs of recovery in freight demand and expects a recovery in total passenger traffic volume by 2010.

Airbus and Boeing are headed for their worst annual order tally in at least 15 years as struggling airlines cancel or defer almost as many planes as they are buying.

The world's airlines are expected to post 2009 losses of $9 billion, with first-half net losses hitting at least $6 billion, IATA has said.


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## hkskyline

*Airline trade group forecasts deeper 2009 losses *
15 September 2009
By John Crawley

WASHINGTON (Reuters) - The outlook for global airlines this year has worsened, with a leading trade group projecting $11 billion in losses as weak passenger and cargo demand pressure revenues.

"The industry situation remains bleak," Giovanni Bisignani, director general of the International Air Transport Association trade group, said Tuesday.

"With rising fuel costs and falling yields, recent optimism in the global economy has not appeared on the industry's bottom line," he told government and industry officials in a speech.

In coming months the airline industry could see other bankruptcies, Bisignani said, declining to be more specific about carriers or regions that are most vulnerable.

But he said smaller- and medium-sized carriers have not had the access to debt markets that their larger peers enjoy, putting them in a more fragile condition.

Low-cost, Slovakia-based airline SkyEurope filed for bankruptcy and suspended all flights earlier this month. Japan Airlines , Asia's biggest carrier, is undergoing a state-supervised restructuring after years of losses. U.S. and other carriers are seeking to invest in the company.

Bisignani said the two-year downturn is worse than the financial hit carriers took after the Sept. 11, 2001 hijack attacks on New York and Washington when travel was severely depressed.

"This is not a short-term shock," Bisignani said in projecting nearly $4 billion in losses for 2010.

But airlines are not looking for government bailouts similar to help extended after the 2001 attacks and the billions given to distressed U.S. automakers this year, he said.

In the United States, Bisignani made his first formal pitch to the Obama administration to relax the law that restricts foreign ownership of domestic airlines.

The IATA trade group estimated in June that airlines would lose $9 billion in 2009 after an $8.5 billion loss in 2008, when record high oil prices dragged down results.

The Geneva-based group's 230 member airlines account for some 93 percent of international air traffic. Members include British Airways, Cathay Pacific, Emirates and United Airlines.

During an earlier conference call with reporters, Bisignani said revenues were expected to slump by 15 percent this year and would not return to 2008 levels until 2012 at the earliest.

For 2009, IATA said it expects passenger traffic to fall 4 percent, compared with its June estimate of 8 percent. It sees cargo demand falling 14 percent.

The updated forecast assumes oil prices average $61 a barrel, up from $56 a barrel in the previous forecast.

U.S. STOCKS HIGHER AS SENTIMENT IMPROVES

Despite the dour forecast, sentiment on airlines has improved recently as cost-cutting has helped soften the blow from weaker demand and some airlines have said revenue trends may improve.

U.S. airline shares were mostly higher Tuesday, with some carriers rising as much as 8 percent. The Arca Airline Index was up more than 4 percent.

Among non-U.S. carriers, Air France-KLM rose 1 percent in Paris and British Airways was flat in London trading.

"The dynamics of the U.S. airline industry are very different from the dynamics of the global airline industry" that IATA represents, said Michael Boyd, an airline consultant.

For instance, he said non-U.S. carriers such as JAL are highly dependent upon international travel that has taken a hit in the recession, unlike U.S. airlines.

On Monday, Delta Air Lines Inc, the world's largest carrier, boosted its operating margin forecast for the third quarter, citing an estimated drop in fuel costs.

After Delta's improved outlook, many investors are betting that other U.S. airlines will come out with similarly positive announcements, said airlines analyst Helane Becker of Jesup & Lamont Securities.

"The realization that everyone else is going to put out guidance is maybe catching up to people," Becker said in explaining the airline stock rally on Tuesday. In a research note Monday, J.P. Morgan analyst said he expected Continental Airlines to be the next to unveil an improved outlook.

The new forecasts could spur a rash of analyst upgrades, which would bode well for stocks.

"A lot of stocks are rated 'hold' or 'sell' by a lot of analysts," Becker said. "There is room for analyst upgrades."


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## firoz bharmal

Concouse 3


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## hkskyline

*Air travel slump has bottomed out, says trade body*
30 October 2009
The Herald

THE slump in aviation triggered by the global recession bottomed out last month but the industry is still a long way from recovering from a historic loss of passengers, the leading international airline representative body has said .

Figures from the International Air Transport Association (Iata) show passenger numbers on international flights grew marginally in September and that load levels - the proportion of seats on a plane that are filled - had recovered to "pre-crisis" levels.

However, the body, which represents some 230 airlines, said the latest figures were "misleading" as they compared with an exceptionally bad month last year, and that rising costs and a sharp drop in the lucrative business market were still making it difficult for operators to survive.

Giovanni Bisignani, Iata's director general, said: "It is far too early to call this a recovery. The worst may be over in terms of the fall in demand, but yields continue to be a disaster and costs are rising. " With Edinburgh the glaring exception, most of the UK's airports have continued to report a continuing decline in passengers in recent months, though the rate has slowed from the precipitous drop around September last year.

Glasgow and Aberdeen airports, both owned by BAA, saw passenger numbers fall by 12per cent and 9per cent respectively last month while Prestwick Airport in Ayrshire saw an even more tumultuous 28per cent decline, brought about by cuts in capacity by Ryanair.

The no-frills airline has meanwhile expanded in Edinburgh, helping to fuel a 3.8per cent increase in passenger numbers in September, its fourth consecutive month of growth.

In the latest addition to its network, Ryanair yesterday announced a new service from Edinburgh to Bordeaux, which will begin service on March 10 next year with four flights scheduled a week.

International passenger demand is now 5per cent higher than the low point reached in March 2009, but 6per cent below the peak recorded in early 2008, Iata said yesterday.

Aircraft are flying less frequently, which increases costs, and airlines have also been hit by the continuing rise in fuel prices.


----------



## hkskyline

*Airlines raise cash but IATA keeps 2009 loss outlook *

GENEVA, Nov 3 (Reuters) - The world's leading airlines were able to raise $8 billion in new cash from capital markets in the past two months, but their full-year outlook remains worrisome, an industry group said on Tuesday.

In its latest industry snapshot, the International Air Transport Association said it still expected airlines to lose $11 billion on a net basis in 2009 and warned that with jet fuel prices on the rise, cash flows would be under pressure.

Air fares have been nudging up along with improved economic and consumer sentiment worldwide, IATA said, while stressing that prices remain much lower than they were before the financial crisis hit.

"The revenue environment remains extremely challenging," said the group, which represents 230 airlines including British Airways , Qantas , United Airlines , Cathay Pacific and Emirates [EMIRA.UL].

It has previously said the airline sector would lose $4 billion in 2010 as a result of continued economic improvement.


----------



## hkskyline

*Airlines to lose $5.6 billion in 2010, on top of $49 billion losses since 2000 *
15 December 2009

GENEVA (AP) - The global airline industry will face another harrowing year in 2010, with losses expected to reach $5.6 billion despite some recovery in passenger and cargo traffic, an industry group said Tuesday.

Low yields and rising costs are a "continuing disaster" for world airlines, who have already lost $49 billion since 2000, according to the International Air Transport Association. The industry group maintained its estimate of $11 billion full-year losses for 2009.

"The worst is likely behind us," said IATA chief executive Giovanni Bisignani. "Some key statistics are moving in the right direction. Demand will likely continue to improve and airlines are expected to drive down non-fuel unit costs."

Still, he conceded that "airlines will remain firmly in the red in 2010."

IATA attributed much of the pressure on the "extraordinarily low" yields airlines are currently generating -- the average price someone pays to fly one mile. Those will barely improve in 2010 because of a glut of planes on the market and lower corporate travel budgets, it said.

The group, which represents 240 airline companies worldwide, has been forced to lower its forecasts as the intensity and longevity of the economic crisis became clearer. It had earlier forecast $3.8 billion in losses for 2010, and only 12 months ago was predicting that deep cost cuts by U.S. carriers would limit industry losses to $2.5 billion for this year.

"2009 very quickly got much worse than we expected," said IATA chief economist Brian Pearce.

Passenger traffic fell 4.1 percent, from the already-low levels they reached in 2008 when financial markets collapsed, and premium fares fell the hardest. Cargo traffic, meanwhile, declined 13 percent.

The U.S. carriers that were being counted on to lead the industry toward recovery also struggled, losing an estimated $2.9 billion in 2009. European airlines and Asia-Pacific carriers both lost around $3.5 billion, while the Middle East fared somewhat better, with a negative result of $1.2 billion.

Latin America was the only region in the black in 2009, and is expected to be the sole profit-maker again next year.

IATA said it expects passenger traffic to bounce back by 4.5 percent in 2010, with nearly 2.3 billion people traveling. Cargo demand will perk up by 7 percent, but remain significantly below the peak traffic of 41.8 million tons in 2007.

Bisignani said 2010 will look similar to 2007 in terms of passenger traffic and an oil price of around $75 a barrel. But revenues will be $30 billion less next year than in 2007, and "change is needed," he said.

He urged airlines to focus on the traditional solutions of conserving cash and cutting costs, while governments should cut taxes.

After 30 airlines were eliminated in 2009, Bisignani said the big carriers were healthier now as a result of $38 billion in cash they have raised this year. Still, carrier debts total $220 billion and regional carriers may be in trouble.

"I don't see the threat of major bankruptcies, but smaller airlines (will) have difficulty accessing credit," he said. "As a result, they are fragile."

Beyond the airline data, Bisignani also launched a surprisingly sharp criticism of the British government for raising taxes on emissions with the purported goal of halting global warming. The higher charges are robbing carriers of the money they need to invest in cleaner technologies to fulfill an industry pledge to halve carbon emissions by 2050, he said.

"The U.K. is the worst tax offender," Bisignani told reporters. "Now the government admits that it is just a tax to pay bankers' bonuses, completely unrelated to the environment."


----------



## Shezan

firoz bharmal said:


> Concouse 3


..where?


----------



## hkskyline

*Asia-Pacific airline passengers slump 5.7 percent in 2009*
22 January 2010
Agence France Presse

Asia-Pacific airlines suffered a 5.7 percent drop in passenger numbers and an 11 percent slump in cargo traffic in 2009 as they weathered their worst ever downturn, an industry body said Friday.

The Association of Asia Pacific Airlines (AAPA) said that the collapse in corporate travel and intense price competition during the global recession saw airline revenues tumble 20-25 percent.

"We have been through downturns before, but none as severe as we’ve experienced in the past two years," AAPA director general Andrew Herdman said in a statement.

Airlines cut flights and cargo capacity, and shaved back on costs, but were still not able to fully offset the effects of sharply lower revenues, compounded by continuing volatility in oil prices, he said.

"Overall, Asia Pacific airlines are expected to report significant losses for 2009, following similar heavy losses suffered in 2008," he said.

However, Herdman said traffic numbers in recent months had shown signs of recovery.

"The cargo business is regaining some of its dynamism, and passenger demand on short haul leisure routes within the region has already picked up, although business travel demand is recovering more slowly," he said.

Regional airlines faced the task of "conserving cash, rebuilding damaged balance sheets, and carefully managing capacity to match demand as they work towards restoring profitability."

"Whilst we remain hopeful about future prospects, the outlook for 2010 very much depends on the sustainability of what still appears to be a rather fragile global economic recovery."

The International Air Transport Association (IATA) has said it expects Asia-Pacific carriers to lose 700 million dollars this year, an improvement from the 3.4 billion dollars lost last year.

Singapore Airlines posted its first quarterly loss in six years during the June 2009 quarter and deferred the delivery of eight A380 superjumbos. Australia's Qantas and Hong Kong's Cathay Pacific also saw earnings slump.

Asia's largest carrier Japan Airlines this week filed for bankruptcy, and other airlines could be in line for government bailouts.

Globally, IATA is forecasting a loss of 5.6 billion dollars for the industry this year.


----------



## hkskyline

*Air cargo jumps in Dec but aviation outlook tough -IATA*

GENEVA, Jan 27 (Reuters) - Air freight traffic jumped by almost a quarter in December in a positive end to the aviation industry's worst year, showing economic recovery is picking up steam.

However, the International Air Transport Association (IATA) said the aviation sector would face a tough 2010 making up for the lost demand in 2009 and handling new security demands.

"The industry starts 2010 with some enormous challenges. The worst is behind us, but it is not time to celebrate," IATA Director-General Giovanni Bisignani said in a statement.

The slump in demand in 2009, the worst year in the industry's history, meant airlines would face another spartan year adjusting to two-and-a-half lost years of passenger growth and three-and-a-half years of lost freight growth, he said.

This would require airlines to focus on matching capacity to demand and controlling costs, he said.

"In terms of demand, 2009 goes into the history books as the worst year the industry has even seen," Bisignani said.

IATA said air cargo traffic -- a barometer of the strength of world trade -- in December was 24.4 percent higher than a year earlier. Its load factor, an industry measure of capacity utilisation, was 54.1.

But this year-on-year strength was exaggerated by an unusually weak December 2008, the low-point in the cycle.

For 2009 as a whole, freight demand fell 10.1 percent -- in line with the World Trade Organisation's forecast for the contraction in global trade -- for a load factor of 49.1.

Passenger demand rose 4.5 percent in December for a load factor of 77.6, but for the year as a whole it fell 3.5 percent, giving a load factor of 75.6, said IATA, which groups 230 airlines including British Airways , Singapore Airlines , and Emirates [EMIRA.UL].

In a further sign of economic recovery, the Dutch CPB institute said trade in the three months ended November was 5.7 percent higher than in the preceding three months -- the biggest increase since it started tracking trade data in 1991.

The more volatile monthly figures showed trade volumes rose in November by 1.1 percent from October, when they increased by an upwards revised 1.4 percent, but were still 12 percent below their April 2008 peak, said the institute, whose trade data is used by the World Bank and European Commission.

Bisignani said the aviation industry would have to face tougher security requirements following an attempt to blow up a U.S. passenger jet on Dec. 25.

Bisignani said global airlines were spending $5.9 billion a year on security measures, which were the responsibility of governments who should be picking up the bill.

IATA has forecast that airlines will lose $5.6 billion on a net basis this year after losing $11 billion in 2009.


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## hkskyline

*Russia air traffic fell 9.4 percent in 2009 *
28 January 2010

MOSCOW, Jan 28 (Reuters) - Russian air passenger numbers fell 9.4 percent in 2009 as the global downturn in air travel took its toll, a figure nearly three times as severe as the global average.

Russia's state air transport agency said on Thursday that 45.1 million business and holiday travellers had flown in the country last year, down 9.4 percent on 2008, though December had recorded an 18.7 percent jump.

The International Air Transport Association (IATA) said on Wednesday 2009 air traffic fell 3.5 percent globally, while also recording a sharp rise in December. 

Oleg Panteleev, editor of the specialist aviaport.ru website, said he expected Russian air passenger traffic to rise 8 percent in the current year as the economy picks up.

"Aviation is very sensitive to the economic climate," he said.

The Russian agency added that state carrier Aeroflot carried 5.6 percent fewer passengers in 2009, beating the overall Russian market.

The government has had to mop up a string of defunct airlines destroyed by the industry crisis, pulling them together into the combined group Rosavia.

The state also took greater control of Aeroflot earlier this week, agreeing to take a near 25.8 percent stake from tycoon Alexander Lebedev to top up its shareholding to over 75 percent.


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## hkskyline

*Air freight, passenger data jump in Jan-IATA*
2 March 2010

ZURICH, March 2 (Reuters) - Asia powered improved demand for international air traffic in January as both passenger and freight figures jumped by more than the sharp falls triggered by the financial crisis a year ago.

Air freight traffic rose by 28.3 percent while passenger demand was up 6.4 percent from a year earlier, the International Air Transport Association (IATA) said.

Asia led the rise in air cargo with a jump of more than 38 percent while passenger demand was up 6.5 percent.

Still, IATA Director General Giovanni Bisignani warned that the recession-hit airline industry faced another tough year as yields -- the profit margins airlines make on passengers and cargo -- remained under pressure.

"We can start to see the future with some cautious optimism, but better volumes do not necessarily mean better profits," Bisignani said.

Last January, airlines caught in the depth of the crisis scrambled to cut flights as companies shelved business travel and cargo shipments.

Air freight is a good leading indicator of world trade movements since shippers tend to switch to air when speed is more important than cost.

Demand is strengthening, with this January's traffic showing bigger rises than those in December, when air freight was up by 24.4 percent and passenger demand was up 4.5 percent.

IATA also said January freight and passenger demand rose from December when adjusted for seasonal factors.

Air freight fell 10 percent in 2009, reflecting a fall in global trade which the World Trade Organisation estimated at 12 percent.

Bisignani said despite recent improvements in volumes passenger yields were still 15 percent below peak and the industry remained on course for losses of $5.6 billion this year.

Tough times have spurred a fresh round of consolidation, such as a deal sealed last year between British Airways and Spain's Iberia.

IATA represents some 230 airlines operating 93 percent of all international traffic. Domestic flights are excluded from its data.


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## hkskyline

*IATA says airline traffic up 5.7 percent in January; economy traffic inching near 2008 highs *
17 March 2010

NEW YORK (AP) - An international airline group said Wednesday that airlines flew 5.7 percent more passengers in January than the same month a year earlier.

The International Air Transport Association said premium travel rose 5.5 percent in the first month of 2010, while economy travel rose 5.7 percent.

Compared with recent low points last year, first and business class traffic has improved more than coach, IATA said. But premium traffic has much farther to climb to reach 2008 peaks. Premium traffic is now 16 percent under 2008 highs, while economy is just 3 percent under the best times of that year.

Fares are also rising and are up about 10 percent from mid-2009 lows, the trade group said. But fares for business and first class are still 30 percent lower than early 2008 highs, on average.


----------



## Face81

Dubai Airport Feb. Passenger Traffic Rises 22.6% to 3.64 Million
March 22, 2010, 3:37 AM EDT

http://www.businessweek.com/news/20...enger-traffic-rises-22-6-to-3-64-million.html

By Arif Sharif

March 22 (Bloomberg) -- Dubai Airports, home to the biggest Arab airline Emirates, said passenger traffic grew 22.6 percent in February from a year ago to 3.64 million.

Cargo handled by the airport jumped 26.7 percent in February to 171,707 tons, the state-run facility said in an e- mailed statement today. The strongest passenger growth was reported from Western Europe, the Indian subcontinent and the Middle East, it said.

To contact the reporter on this story: Arif Sharif in Dubai at [email protected]

To contact the editor responsible for this story: Shaji Mathew at [email protected]


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## hkskyline

*World airline industry seen back in black in 2011 *

SANTIAGO, March 24 (Reuters) - The world's airlines should post a combined profit in 2011, after an expected loss of about $2.8 billion in 2010, the head of airline industry body IATA said on Wednesday.

A shortfall in global air carriers' revenues from their peak in 2008 should be made up within two years, IATA Director-General Giovanni Bisignani told a news conference at the FIDAE air industry fair.

"With a loss of $2.8 billion this year, I think we can say with a reasonable degree of certainty that we will be back in the black in 2011," Bisignani said. He said the body would issue its forecast of 2011 industry results in June.

A gap of nearly $80 billion in annual revenues lost since a 2008 peak would be made up within two years, he said.

IATA forecasts industry revenues of $522 billion for 2010, which is still $42 billion shy of 2008 levels.

"We have an (expected) improvement this year of $43 billion (over 2009 levels), so we suppose that in two years we will recover the loss," Bisignani said.

He expects airlines in North America to post a combined loss of about $1.8 billion in 2010, and sees European airlines losing a total of $2.2 billion.

However, Latin American airlines will post a combined profit of about $800 million this year, he forecast. Bisignani expects air traffic demand in Latin America to rise 12.2 percent in 2010 from 2009 levels.

IATA groups about 230 airlines, including Air China , Lufthansa , Singapore Airlines and Skywest.


----------



## hkskyline

*IATA chief says further airline mergers essential *

TOKYO, April 12 (Reuters) - Further mergers among airlines are essential in order to cut costs and improve competitiveness in an industry seen sustaining combined losses of $2.8 billion this year, the head of airline industry body IATA said on Monday.

"Mergers and consolidation is a must ... I strongly support consolidation," Giovanni Bisignani, director-general of the International Air Transport Association, told few reporters in Tokyo.

Asked about a possible merger between United Airlines and US Airways , he said he would not comment on individual deals.

IATA said on March 30 that airlines were climbing out of recession with strong rises in passenger travel and cargoes in February. Passenger demand in February was up 9.5 percent from a year earlier, while supply increased by only 1.9 percent.


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## hkskyline

*IATA Sees Faster Than Expected Recovery Of Aviation Industry *
3 June 2010

BERLIN (Dow Jones) - The airline industry will recover quicker than expected from recent crises, the International Air Transport Association said Thursday, adding it is "cautiously optimistic" about the expected losses for the current year.

"The recovery in the airline industry will probably take two years," IATA Director General and Chief Executive Giovanni Bisignani said at a press conference in Berlin. There are "very, very clear signs," he said, pointing to significantly higher air traffic and freight volumes. He added, however, that losses for the sector are to be expected this year and next year.

The international trade body represents some 230 airlines worldwide, comprising 93% of scheduled international air traffic.

"The strong [air] traffic trend that showed before the eruption of the volcano in Iceland, allows us a positive stance toward the future," Bisignani said. The global economic recovery is getting along faster than expected, adding "it is finally time for cautious optimism."

Monday, IATA will present a new outlook for the aviation industry, after the expected 2010 loss was already halved to $2.5 billion in March, Bisignani said, four days before the annual general meeting of the industry and the World Air Transport Summit in Berlin.


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## hkskyline

*Air passenger, cargo traffic rise in May - IATA*

ZURICH, June 29 (Reuters) - Demand for air travel and air freight rose strongly in May and now exceeds levels seen before the global economic downturn, the airlines body IATA said on Tuesday.

Passenger demand rose 11.7 percent from a year earlier, while cargo demand was up 34.3 percent, the International Air Transport Association said.

IATA's 230 members include British Airways , Singapore Airlines and United Airlines .

"Demand rebounded strongly in May following the impact of the European volcanic ash fiasco in April. Passenger traffic is now 1 percent above pre-recession levels, while the freight market is 6 percent bigger," said Giovanni Bisignani, IATA's Director General.

European airlines recorded the weakest growth in passenger demand at 8.3 percent, while Latin American carriers recorded the fastest growth, with a 23.6 percent increase, IATA said.

Air cargo is seen as a leading indicator of the health of global trade.

Earlier this month, the Geneva-based IATA said government spending cuts and debt worries across Europe threatened to weaken demand for air travel on the continent. 
Last month IATA said that in April, when the volcanic ash eruption in Iceland suspended flights across Europe and around the world, passenger traffic fell 2.4 percent year-on-year.


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## sofiane

Morocco

Statistiques du 1er semestre 2010 :

1) Aéroport Mohammed V - Casablanca ------ 3 281 209 (+13,99%)
2) Aéroport Marrakech - Menara -------------1 675 819 (+11,02%)
3) Aéroport Agadir - Al Massira ----------------767 736 (+6,15%)
4) Aéroport Tanger - Ibn Batouta --------------322 754 (+22,72%)
5) Aéroport Fès - Saïss ------------------------319 874 (+37,39%)
6) Aéroport Oujda-Angads ---------------------182 897 (+16,20%)
7) Aéroport de Nador - Al Aroui ----------------172 078 (+31,95%)
8) Aéroport international Rabat - Salé---------- 153 995 (-3,15%)


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## hkskyline

sofiane said:


> Morocco
> 
> Statistiques du 1er semestre 2010 :
> 
> 1) Aéroport Mohammed V - Casablanca ------ 3 281 209 (+13,99%)
> 2) Aéroport Marrakech - Menara -------------1 675 819 (+11,02%)
> 3) Aéroport Agadir - Al Massira ----------------767 736 (+6,15%)
> 4) Aéroport Tanger - Ibn Batouta --------------322 754 (+22,72%)
> 5) Aéroport Fès - Saïss ------------------------319 874 (+37,39%)
> 6) Aéroport Oujda-Angads ---------------------182 897 (+16,20%)
> 7) Aéroport de Nador - Al Aroui ----------------172 078 (+31,95%)
> 8) Aéroport international Rabat - Salé---------- 153 995 (-3,15%)


Are the increases attributable to LCC entry, such as Ryanair and easyJet? They're quite impressive increases.


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## jemurillo0705




----------



## hkskyline

*Brazil Embraer: China to Boost Global Regional Jet Demand To 4.9%*
19 July 2010

SAO PAULO (Dow Jones)--Brazil's Empresa Brasileira de Aeronautica SA (ERJ, EMBR3.BR), or Embraer as the world's fourth-biggest plane maker is known, expects Chinese buying to boost global demand for regional jets to 4.9% a year over the next two decades.

China will likely see demand for planes with 30-to-120 seats expand 7.3% a year, while air travel in emerging economies including Latin America and Pacific Asia will grow 6% a year, Embraer said in a statement Monday.

Demand from North America and Europe will likely grow 3.5% a year through 2029, Embraer said.

The company, which is participating in the Farnborough air show in England, also said it sold regional jets to two Brazil airlines: Trip Linhas Aereas and Azul Linhas Aereas Brasileiras, the company founded by JetBlue Airways' David Neeleman.

Trip will buy two Embraer 190 planes for a total of $80 million, while Azul ordered five Embraer 195 jets for a total of $211 million. The Azul orders were already included in Embraer's backlog in the second quarter, the plane maker said.


----------



## michael_siberia

http://www.euronews.net/2010/07/20/european-airspace-faces-radical-restructuring/



> *European airspace faces radical restructuring*
> 
> The idea of a single European sky has been on the agenda since 1960 when Eurocontrol was formed to create a single airspace for the union’s six founding member states.
> 
> Forecasters predict that air traffic will double by 2020. Current systems will manage the growth until the middle of the next decade. Following that radical measures are required to prevent severe congestion.
> 
> As it stands there are 27 airspaces and 50 control centres. In 2012 the SES will come into force with the union of the airspace of France, Germany, Switzerland, Belgium, the Netherlands and Luxembourg.
> 
> The French air traffic unions believe the formation of the SES will result in the loss of public sector jobs.
> 
> The EU backs the plan designed to restructure European airspace based on traffic flow, rather than national borders, increased capacity and the overall efficiency of European air traffic control.


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## hkskyline

*Bumped? You may be stuck ; Flight cutbacks mean fuller loads, fewer seats *
17 August 2010
USA Today

Lots of luck catching another flight if you've been bumped or miss a connection.

Commercial airlines in the USA have never been so full. Seven of them -- Delta, American, United, Continental, US Airways, AirTran and Alaska -- reported filling at least 87% of their seats in July. Even Southwest, always the industry's laggard in load factor, beat the industry's average over the previous six Julys of 84.6% by filling 84.9% of its seats.

That leaves precious few spots available if you've been bumped off a full flight or miss a connecting flight. And because airlines are scheduling fewer flights than five years ago, travelers could face long waits for a direct flight to their destinations or have to settle for circuitous reroutings to get there.

Some travelers, such as Robert Beilstein, consider themselves lucky if a missed flight doesn't cost more than a day's time. Beilstein, a supply-chain software consultant from North Syracuse, N.Y., twice recently missed connections to San Antonio at Baltimore- Washington International Airport. He made it to San Antonio both times, after being rerouted via Denver.

"I did lose a day's worth of consulting revenue," he says. "But at least I did manage to get there in one day and didn't lose two days of revenue." He says he's even more "lucky" he hasn't been bumped from a flight lately.

For those who've been bumped off flights against their wishes, Transportation Secretary Ray LaHood has proposed increasing the maximum compensation from $800 to $1,300. The proposal is included in a package of "fliers' rights" rules that LaHood wants to impose this fall. The Air Transport Association, the trade group that represents the nation's biggest airlines, says it won't object to raising the compensation. Missing a connecting flight as Beilstein did is far more common than being bumped as a result of an airline selling more tickets for a flight than the plane has seats.

However, most delays leading to missed connections are caused by weather. And unlike overbooking, the weather is outside airlines' control. Most passengers who miss a connecting flight aren't owed anything, although airlines sometimes provide vouchers for meals and hotel rooms. LaHood isn't proposing to change that.

Most airlines automatically reschedule passengers with computer software that often predicts missed connections before a plane has landed. The airlines say this lets them speed people who've missed flights to destinations as quickly as possible.

Some travelers aren't convinced.

"Airlines do not care at all anymore if passengers are inconvenienced," says Jill Naas, a project manager from Seattle who flies at least monthly. She has been able to get other flights after missing connections, she says. But, she says, she's "had to fight like hell" and "emphasize" her elite-level frequent-flier status with airlines to do it.

A growing problem

Bumping, known as "denied boarding" in the industry, isn't a big problem, statistically speaking. In 2009, 69,416 passengers were involuntarily bumped, out of 584 million passengers boarded in the USA. An additional 695,510 were coaxed into giving up their seats by offers of discounts on future travel. The rate of involuntary bumping in 2009 was minuscule: 1.19 per 10,000 passengers boarded.

However, it's a growing problem. In the first half of this year, the rate rose to 1.37 per 10,000 boardings, the highest first-half rate of people involuntarily denied boarding in 16 years. The rise in involuntary bumpings is a byproduct of U.S. airlines' record- high passenger loads. That's the result of the airlines cutting capacity, or the number of seats available, by 12% since 2005 by reducing the number of flights or moving to smaller planes.

"The people who volunteer (to be bumped) ... tend not to be all that upset about it," says Ira Gershkoff, a former airline scheduler who develops software for SlipStream Aviation Software that helps airlines better match capacity to fluctuating travel demand. "They brag to their friends about the compensation they got. But those who are involuntarily bumped are upset. They ... had to be somewhere."

Ed Perkins, a contributing editor at SmarterTravel.com, says airlines for the most part handle the job of bumping passengers off a flight fairly well, though he thinks that passengers who are forced off flights against their will often aren't compensated sufficiently for the inconvenience.

"(Airlines) are able to take care of roughly nine out of 10 cases of bumping by offering people some kind of goody," says Perkins, who was Consumer Reports' travel editor for four decades. "But times do come when nobody wants to get off the airplane."

In addition to providing a seat on a later flight, carriers must pay involuntarily bumped passengers -- in cash or by check -- an amount equal to the price of their ticket, or $400, whichever is lowest. If the passenger arrives more than two hours late, the compensation cap rises to $800.

But the average domestic ticket in the USA in the first quarter of the year was $328. Few involuntarily bumped travelers ever get paid the full $800, or even $400. Typically, only those who buy first- or business-class tickets or full-price coach fares qualify for the maximum payout. The budget traveler flying on a $139 ticket gets only $139.

LaHood wants to raise the caps to $800 and $1,300. But Perkins says the formula, not the actual amount of compensation, is what's wrong.

"I see no reason why the dollar compensation should have anything to do with how much you paid for your ticket, because that doesn't have anything to do with the amount of inconvenience," he says. "The compensation should be a fixed amount. And for a lot of travelers, the money may not be near as important as fixing their trip. There ought to be more focus on that."

He says airlines should be required to put involuntarily bumped travelers on the next available seat to their destination, even if it means paying another airline to carry them.

Most airlines say they won't hesitate to put bumped fliers on competitors' planes if that's the best solution.

Monte Ford, chief information officer at American Airlines, says, "We have become more progressive in our thinking about how and when we put somebody on some other airline's aircraft. In a disruptive situation, we'll put somebody on someone else's airplane in a minute."

But critics such as Perkins say that's often done only as a last resort -- often after a bumped passenger's frustration boils over into an ugly confrontation.

Missing connections

Airlines don't have to report the number of passengers who miss connecting flights. But Gershkoff, who is researching the issue, thinks about 7% of all passengers miss their connections.

On the surface, absorbing those fliers shouldn't be a problem.

Despite fuller flights, airlines still can't fill about 20% of their seats over the course of a year. But missed connections don't happen at a steady pace. They come in bunches, often when bad weather throws flights off schedule at one or more big airport hubs.

Delays, which often lead to missed connections, also tend to have a ripple effect. An hour's delay on one plane in Dallas in the morning becomes a 90-minute disruption in New York by noon, a three- hour nightmare in Chicago by 5 p.m., and a five-hour-late arrival on the West Coast by the end of the day. Along the way, 500 passengers scheduled to fly on that one plane have their travel schedules thrown into chaos. Chances are if one plane is affected, 30 others are, too.

"A 30-minute fog event at one airport can throw the rest of the day off," says Michael Baiada, president of ATH Group, a consulting group that does time-flow management consulting work for airlines. "The flights using that plane throughout the day just go later and later and later."

More than 1.9 million passengers board flights on U.S. airlines on the average day. If just 10% miss connecting flights or can't begin their trips on time because travel is disrupted elsewhere, about 125,000 people could be forced to compete for the few remaining unsold seats that day. (Schedulers estimate that about a third of passengers who miss flights are leaving from their home airport and go home to wait a day before flying or simply give up their travel plans.)

And there are fewer flights to get on than five years ago.

For example, travelers who missed United Airlines' first flight from Chicago O'Hare to Raleigh-Durham in August 2005 had six more United flights that day to choose from, a USA TODAY analysis of flight schedule data provided by OAG Aviation Solutions shows. Today, there are only four flights total each day.

Five years ago, Continental flew four times a day from Cleveland to South Bend, Ind., the data show. Today, it has three flights. American has cut the number of daily flights from Dallas/Fort Worth to Huntsville, Ala., to three from six. In 2005, Northwest flew eight times a day from Cedar Rapids, Iowa, to Minneapolis-St. Paul. Delta, which bought Northwest in 2008, flies the route five times a day now.

As a result, it can take travelers a day or more to reach destinations. It can cost hours of scrambling on the phone, extra expense and stress. It's also why travelers say it's important how airlines and airline workers treat them when things go wrong.

Mitchell Fong, a financial services industry executive from Mill Valley, Calif., who flies 200,000 miles a year, recalls a day last winter when his flight into Chicago arrived too late to make his connection to Milwaukee. United's computer system automatically rebooked him on the next available flight -- the next morning. Fong would have missed his meeting in Milwaukee. Luckily, he hitched a ride that night with an associate who happened to be driving there.

"United was not sympathetic, did not offer any compensation and did not offer extras or perks to ease my situation," Fong says.

U.S. airlines' aren't obligated to provide anything beyond rebooking to travelers who miss connections for reasons beyond airlines' control, such as weather. Being an elite member of a carrier's frequent-flier program may be the single best way to avoid being bumped, and of getting one of the few available seats on the next flight. But it's no guarantee.

Airlines consider the price paid by each disrupted passenger for their ticket; whether any have health issues that require special attention or are unaccompanied minors; whether passengers are part of a group; and most important, which passengers will be the most inconvenienced, or delayed the longest, if they don't get the next available seat.

It also helps to check in early. Check-in times can be the tie- breaker.

Rahsaan Johnson, a spokesman for United, says the difficulty in getting a seat nowadays is overstated. And, he says, getting one shouldn't be thought of as a contest between passengers.

"Every day of the week, there are airline employees and retirees who are at the bottom of the stand-by list, who do get onboard planes and enjoy a flight," he says. "It's a fallacy that with 85% load factors, you can't get a seat. Statistically, it is more difficult. But it is done all the time."

Contributing: Barbara Hansen


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## hkskyline

*Airlines start lining up for Africa take-off*
18 August 2010
Financial Times

The football World Cup is over, the vuvuzelas have been consigned to the dustbin and fans have turned their attention from Africa to Brazil, host of the 2014 contest. But for one group at least, the continent remains in sharp focus: international airlines.

According to the International Air Transport Association, airlines increased the amount of flying capacity to and from Africa by 8.6 per cent over the year to the end of June compared to 2009, more than any other region except for the Middle East.

Over the next three years Iata forecasts that the number of passengers travelling to and from Africa will rise at a compound annual rate of 6.5 per cent, making it one of the fastest growing regions in the world.

While US and European airlines have been cautiously adding capacity to Africa for years, the drive has picked up in intensity in recent months, leading industry executives to talk of a new "scramble for Africa" as airlines position themselves for the future.

Executives point to high growth levels that suggest an increasing need, and ability to pay, for travel by air. Africa's real gross domestic product was $1,600bn in 2008, having grown 4.9 per cent per year since 2000 - more than twice as fast as in the 1980s and 1990s.

Much of that can be put down to Africa's large mineral reserves - which have become a focus of fast-growing Asian economies. Traffic between Asia-Pacific and Africa is forecast to grow at 9 per cent per year over the next decade according to some estimates.

US and European airlines are also boosting their connections to resource-rich regions. In June, Delta Air Lines started a service between Atlanta and Accra and aims to add services to Liberia, Angola, Equatorial Guinea, and Kenya in the near future.

Lufthansa, Europe's biggest airline group and a key provider to Africa, has ramped up its connections, adding two new services in west and central Africa and expanding several more since 2008. The group now has 222 flights a week to 33 destinations in Africa.

A recent report by McKinsey Global Institute, entitled Lions On The Move , suggests that the economic foundations of Africa's recent success are broader and therefore will have more "staying power".

Natural resources accounted directly for only a quarter of Africa's GDP growth over the decade while "the rest came from other sectors, including wholesale and retail, trade and transportation, telecoms and manufacturing".

Indeed, Airbus, the European aircraft maker, predicts the recent aviation ramp-up will be sustained. Over the next 20 years the amount of filled capacity on flights between Africa and other parts of the world will grow at 5.6 per cent each year, albeit from a low base.

"There is a lot of money in Africa right now," says Glen Hauenstein, head of network planning at Delta Air Lines, the world's largest airline by revenues. "GDP is small in absolute terms but it is rapidly expanding as political stability spreads."

In this newly competitive environment, US airlines are playing catch-up. While European carriers have offered direct services for decades, non-stop flights from North America to Africa have traditionally been limited, and slumped after the industry recession following the September 2001 terrorist attacks.

Mr Hauenstein says Delta began experimenting with flights to Africa in 2006 with a connection between its hub in Atlanta, Georgia, and the tourist destination of Johannesburg in South Africa, via Dakar, Senegal.

The success of that route has led Delta to try others, with an emphasis on west and sub-Saharan Africa where avoiding European connections can save US travellers time.

Part of the problem was aircraft technology, says Greg Hart, vice-president of network strategy at Continental.

Until the Boeing 777 was developed in the mid-1990s, many destinations in Africa were too far from the US for direct connections, and even then the 777 was too big to make some routes profitable. With the arrival of Boeing's much delayed 787, due around the turn of the year, Mr Hart says that many airlines will for the first time have the right aircraft for the job. Continental plans to connect the energy capitals of Houston and Lagos with a service starting in November 2011. Still, considerable obstacles must be overcome.

According to a 2009 World Bank report on Africa's aviation infrastructure, while the continent is fairly well served by airports, lack of taxi-ways and terminal facilities and "inadequate" air traffic control systems are limiting capacity growth.

Safety is another concern. Last year, Africa had the worst record of any region, according to Iata statistics. While most problems relate to aircraft operated by local airlines, several reports have blamed Africa's weak regulatory oversight, which raises wider issues.

In response, airlines have worked closely with government authorities and spent time and money to upgrade local infrastructure for their new services. Continental will help to upgrade the electrical facilities in Lagos airport to receive the Boeing 787.

In spite of those hurdles the airlines remain confident that the efforts will pay off. "The 787 is going to be the pride of our fleet and we are going to put it into Africa. That speaks volumes of our level of interest," says Continental's Mr Hart.


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## Turbosnail

Courtesy of Delta

Delta Air Lines today filed applications with the European Commission and the U.S. Department of Transportation to operate daily year-round service between London’s Heathrow Airport and Miami International Airport.
If approved, service would begin from Miami on March 27, 2011. Delta, the second-largest carrier at Miami’s airport, would be using Boeing 767-300 aircraft.
Here’s the proposed summer 2001 schedule: Flight number 260 departs Miami at 5:30 p.m. and arrives at Heathrow at 7:30 a.m. (the next day). Flight number 261 departs Heathrow at 10:20 a.m. and arrives in Miami at 3:25 p.m.
The new Delta service would complement existing trans-Atlantic service offered by the SkyTeam alliance from Miami, including year-round flights to Paris operated by Air France and Rome operated by Alitalia.
Delta Air Lines today filed applications with the European Commission and the U.S. Department of Transportation to operate daily year-round service between London’s Heathrow Airport and Miami International Airport.


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## GTR66

My sister was flying last week and her airline oversold one flight and she had to wait for the next round trip. She said two other had the same problem. With demand rising I hear more planes are coming out of the desert. I also hope delta get miami. Miami needs more flights to Europe because AA hasnt done a good job with flights to europe.


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## way of thinking

*Mexicana Airlines (Grupo Mexicana) suspends its operations indefinitely*

A Mexican consortium called Tenedora K announced it has acquired 95% of troubled Mexicana Airlines' holding company and will take over the airline as well as subsidiaries MexicanaClick and MexicanaLink. The carrier's pilots will own the remaining 5% of the holding company, Nuevo Grupo Aeronautico.
Now one of the first actions been taken is to suspend the operations indefinitly.

http://www.mexicana.com/cs/Satellite?pagename=MexicanaG5_US_EN/Page/RedirectSiteAlterno_US_EN


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## hkskyline

*IATA CEO: International Consolidation Essential For Airlines *
25 August 2010

SYDNEY - (Dow Jones)- International consolidation of airlines is essential for the industry to move forward, said the chief executive of the International Air Transport Association in an interview Wednesday.

While regional consolidation in the United States and Europe has helped profitability amongst airlines, IATA Chief Executive Giovanni Bisignani said airlines must now consolidate across regions.

"We need transatlantic consolidation to become a more integrated and global industry," said Bisignani, shortly after speaking at a luncheon in Sydney.

Earlier in the day, IATA, which represents some 230 airlines world-wide, comprising 93% of scheduled international air traffic, reported that international passenger demand in July was 9.2% higher from a year ago, although it said the airline sector recovery has entered a slower phase.

Concerning the slowdown, however, Bisignani noted the Asia-Pacific region has now taken over as the world's foremost region. Asia-Pacific outperformed other regions strongly in July, especially Europe, which remained in the red for the latest month.

More broadly, Bisignani said "the worst is over" for the airline industry following the global financial crisis. While he cited concern about a recent slowdown in the U.S. economy, he was optimistic given continuing strength in freight airline travel.


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