Employment Crossing

At a three-day aviation industry conference, some executives are warning that the global airline business is not likely to see brighter fortunes until 2010 at the earliest.

 

The World Air Transport Forum, uniting a variety of industry players, meets as airlines are battling rising fuel prices, tighter credit conditions and diminishing passenger traffic amid the global economic meltdown, according to the Associated Press.

 

"We are facing probably the worst crisis our industry has ever faced," said Yanik Hoyles of British Airways.

 

Some say it could worsen if recessions break out in North America and Europe, as expected.

 

Steve Ridgway, chief executive of Virgin Atlantic, said 2009 will be the "real telling year. We are not anticipating any kind of pickup until the summer of 2010 but who knows? It may not even be then.”

 

The outlook has changed dramatically since last year's Forum, when the industry expected to make a profit of at least $5.2 billion in 2008.

 

Now the International Air Transport Association is forecasting airline losses may exceed $5.2 billion this year.

 

Traffic declined 2.9 percent in September from a year earlier. It’s the first time since Asia's outbreak of severe acute respiratory syndrome in 2003 that global passenger traffic has dropped.

 

A recent easing of global oil prices has brought relief to airlines, but executives expressed fears that prices could be pushed back up. Oil prices have fallen by about 57 percent since peaking near $150 a barrel in mid-July.

 

Jeffrey Shane, a former U.S. Transportation undersecretary, said the crisis may require regulators to rethink rules prohibiting foreign ownership of national airlines and limiting slot availability at airports.

 

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