International Air Transport Association downgrades 2011 airline industry profit projection to $4 bn

NEW DELHI: The International Air Transport Association (IATA) has downgraded the 2011 airline industry profit estimation to $4 billion, posting 54% decline as compared to $8.6 billion profit forecast in March.

The airline sector has witnessed 78% fall to 18 billion net profit (revised from USD 16 billion) in 2010. On the likely revenues of $598 billion, a USD 4 billion profit equates to 0.7% margin.

Giovanni Bisignani, Director General and CEO, IATA, said, “Natural disasters in Japan, unrest in the Middle East and North Africa, plus the sharp rise in oil prices have slashed industry profit expectations to USD 4 billion this year. That we are making any money at all in a year with this combination of unprecedented shocks is a result of a very fragile balance.”