Middle East airlines losing altitude
Middle East carriers are poised to make less than half the profits they did last year - but are still better off than most of their peers elsewhere.
That’s the verdict of industry body the International Air Transport Association, which has cut the amount it expects Middle East carriers to make this year from $500 million to $400 million in a new forecast published yesterday.
The body notes that this is a “significant drop” compared to the $1 billion in profit airlines in the region managed last year.
Despite the darker outlook, the region’s carriers are doing better than most.
“The weakness of European originating traffic will damage long-haul markets, but Middle East airlines continue to lead the industry on growth,” the authors of the forecast note.
IATA director general and CEO Tony Tyler warns that globally the industry may only turn a profit of $3 billion this year - it made $15.8 billion it made in 2010.
“The eurozone crisis is standing in the way of improved profitability and we continue to face the prospect of a net profit margin of just 0.5 per cent,” he says.