Trade forum sees bottoming out in airline industry

GENEVA - The decline in air travel may have hit bottom, the International Air Transport Association said Thursday, but warned that a recovery was still a long way off.

“The airline industry remains firmly in the red with a fragile business environment,” Giovanni Bisignani, the head of IATA, said in a statement.

Rising costs were a concern for the airlines, he said, with IATA noting that oil prices have jumped to well above $75 per barrel, whilst at the start of the year a barrel was selling for $43.

While Asia-Pacific and Latin American carriers were seeing increase in demand, European airlines saw a deterioration, blamed in part on low-cost companies gaining market shares.

In September, passenger demand was 5 percent better than the low point reached in March, but that was still 6 percent off the peak recorded in early 2008.

Cargo traffic was above the low point reached last September, as global trade took a precipitous fall, but was 17 percent below peak levels, IATA statistics showed.

Given the massive drop in demands last September, as the financial crisis turned into a global economic crisis, year-on-year comparisons would be misleading, IATA said.