Global airlines to lose $9B in 2009 - Sacramento Business Journal:

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The ’s (IATA) new forecast is staggeringly worse thanits $4.7 billion collectiv e loss forecast made just three months ago. The air carrie trade group also downgraded its loss estimatre for 2008to $10.4 billionn from $8.5 billion. “There is no modern precedent for today’s economif meltdown,” IATA director general and chief executive officer Giovanni Bisignanji said in anews “The ground has shifted. Our industruy has been shaken. This is the most difficult situationh that the industryhas faced.” Aftedr the Sept. 11, 2001, terroer attacks on the United industry revenues fell by7 percent, Bisignanij said, and took three years to rebound to pre-9/112 levels.
Revenues will fall to $448 billion in 2009 from $528 billiob in 2008 (15 percent), IATA Passenger yields will dip7 percent. “Thiss time we face a 15 percent drop—a loss of revenuesz of $80 billion—in the middle of a globao recession,” Bisignani said durinh IATA’s annual industry summit. “Our future depends on a drastic reshapingby partners, governmentsa and industry. We cannot bear the cost of governmengt micro-regulation, crazy taxation and partnersw abusing theirmonopoly power.” Northg American carriers will generally fair better than foreignb carriers, IATA said, and should narro w their losses for the year.
North Americanj airlines will lose $1 billion in 2009, dramatically less than the $5.1 billion lost in 2008, as out-of-the-monehy fuel hedges lapse and capacity cuts kick in to right capacityywith demand. Previously, IATA said Northg American carriers would turn a modestg profit forthe year. Asia-Pacific and European carriera are likely to take thebiggestr hits, losing $3.3 billion and $1.8 billion, respectively. Anothe heavily impacted sector, air will decline by 17 percent based on tons Cargo yields will decline11 percent.
Relaxed fuel pricexs over the first five months of 2009 havehelpedd carriers, but prices have begun to climb in recent IATA projects the industry fuel bill to fall from $165 billionj in 2008 to $59 billion in on a $56 per barreol average price of oil. “The risk that we have seen in recentg weeks is that even the slightest glimmer of economi hope sends oilprices higher,” Bisignanij said. "Greedy speculation must not hold the globakeconomy hostage. Failure to act by governments woulfbe irresponsible.” Globally, airlines are in a better cash with more liquidity than in past But, Bisignani warned “a long L-shaped recovery could drainb the industry of cash.
” Bisignani noted industry consolidation, such as the merger betwee n Atlanta-based (NYSE: DAL) and , that have made some playerxs stronger. But he railed against what he called “archaicf limitations on ownership” that prevent the merging of carriera fromdifferent countries.