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Global airline sector profit likely to rise: IATA

April 29, 2013 12:33 IST

Global airline sector profit is likely to grow to $7.5 billion this year, with Asia Pacific and Middle East based airlines dominating the international passenger market and leading the way in terms of improved operating margins, according to IATA data.

This is compared to $4.6 billion worth of profit recorded in 2009, the International Air Transport Association (IATA) report said.

"The world passenger growth in air traffic is recorded at 5 per cent per annum (CAGR) by ICAO scheduled traffic analysis since 1980," said Sunil Malhotra, director, Aviation Sector MENA, Ernst & Young who spoke on Global Aviation trends, quoting IATA figures.

According to IATA, global airline sector profit will grow from $4.6 billion in 2009 to a forecast figure of $7.5 billion for 2013 with Asia Pacific and Middle East based airlines dominating the international passenger market and leading the way in terms of improved operating margins, he said.

Malhotra will present the latest industry findings and a 10-year outlook with a session entitled 'Looking to the skies: global aviation trends 2013–2033' at the Arabian Travel Market (ATM) exhibition here next month.

"According to the report, Asia-Pacific will lead world traffic by 2031, with a 32 per cent share, while the Middle East will rise to 11 per cent in 2031 from the current figure of 7 per cent.

"The future forecasts over the next 20 years for the world GDP growth as per IMF is at 3.2 per cent per annum (CAGR) and based on ICAO forecasts, the number of airline passengers is projected to grow at 4 per cent per annum (CAGR) with airline traffic growth outlined to grow at 5 per cent per annum (CAGR)," Malhotra said.

Kicking off the debate, two of the giants of aviation will take part in The Big Conversation on the first day of the show, with Emirates Airlines President, Tim Clark, and Qantas CEO, Alan Joyce, discussing their groundbreaking partnership.

"The last three years have seen the global aviation industry turn a corner despite ongoing market turbulence.

"While consolidation is the strategy in North America, and European carriers are busy lobbying for an end to excessive taxation and passenger duties, the Middle East and Asia are capitalising on both route network growth opportunities and strong passenger demand," said Mark Walsh, portfolio director, Reed Travel Exhibitions.

Partnership activity is a major focus of the report as airlines are proactively seeking for more meaningful alliances and partnerships to boost their synergies and passenger flows.

According to Malhotra, some Gulf carriers are joining global alliances, whilst others have entered into strategic code shares to promote traffic flows between continents.

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