2009 - losing year for airlines

Air passenger traffic

According to the International Transport Association (Iata), 2009 saw the biggest decline in air passenger traffic in the post-war era.

"In terms of demand, 2009 goes into the history books as the worst year the industry has ever seen," said the Iata's boss Giovanni Bisignani. Compared to a year earlier, passenger traffic dropped by 3.5 percent, while freight traffic fell 10.1 percent as the downturn hit demand. However, figures for December showed a rise in traffic of 1.6 percent on a year ago.

Tough year ahead

Despite the figures improving at the end of 2009, Iata went on to warn that 2010 would be a tough year for airlines the world over. "The industry starts 2010 with some enormous challenges," Mr. Bisignani said to the BBC. "The worst is behind us, but it's not time to celebrate. Adjusting to 2.5 to 3.5 years of lost growth means that airlines face another spartan year, focused on matching capacity carefully to demand and controlling costs."

With airlines struggling to fill more than three quarters of seats, any signs of profit have been delayed and another year of heavy loss is scheduled. Evidence shows that African airlines suffered the most in 2009, with passenger demand down 6.8 percent.

Asia-Pacific and North American carriers saw demand fall by 5.8 percent, while European airlines suffered a five percent fall in demand.

However, Middle Eastern carriers saw passenger demand climb 11.3 percent, and Latin American airlines experienced a 0.3 percent rise.

Collective lost

Still, though, Iata has estimated that airlines collectively lost US$11 billion (GBP£6.8 billion) last year, and stand to lose a further US$5.6 billion this year. Analysts said that price cuts designed to attract customers would continue to eat into airlines' profits.

"Continued fare wars between airlines mean that yields and profitability will be low. Airlines are struggling to fill their airplanes and discounted ticketing has done little to alleviate the pressures on their costs," said independent airline analyst Saj Ahmad.

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