The International Air Transport Association (IATA) is warning that 2009 could be a tough trading year for all airlines, and is predicting that airlines worldwide will lose $5.2 billion in 2008, due to the high price of oil and slowing demand. This could spell the end for cheap flights and affordable global travel.
Aviation fuel is expected to rise to 36% of operating costs by the end of 2008 – compare that to 2002 when it was only 13%.
Traffic data for July ’08 showed a continuing decline in demand, and year on year from July ’07 to ’08 passenger growth slowed to 1.9% - the lowest in 5 years.
The current global economic crisis appears to be shaping the airline industry much more than the SARS epidemic, or indeed September 11th, 2001 and more airlines have gone bust in 2008 than during the aftermath of September 11th.
Tags: airline collapse, Cheap Flights
