Global airlines face increasing difficulties this year with losses at European carriers set to be nearly twice as big as expected, according to estimates from the main industry body.
The International Air Transport Associationforecasts that airlines in Europe will have a combined net loss of $1.1bn this year, up from a previously estimated loss of $600m, as carriers cope with both the fallout of the eurozone crisis and China’s economic slowdown.
On a worldwide basis, airlines are looking at a razor-thin profit of 0.5 per cent this year, said Iata. If Europe’s banking crisis intensifies and global airline revenue drops 1 per cent, the forecast industry-wide net profit of $3bn could easily become a loss of the same size, said Tony Tyler, Iata’s director-general.