IATA paints a grim picture for African airlines in 2017

bagamoyo · 2016-12-10T01:24:31+00:00

December 9, 2016 Geneva - The International Air Transport Association (IATA) announced that it expects African airlines to have a tough challenging performance in year 2017. 2017 Regional Analysis African carriers: Carriers in Africa are expected to deliver the weakest financial performance with a net loss of $800 million (broadly unchanged from 2016). For each passenger flown this amounts to an average loss of $9.97. Capacity in 2017 is expected to grow by 4.7%, ahead of 4.5% demand growth. The region’s weak performance is being driven by regional conflict and the impact of low commodity prices. 2016 2016 will be a record year for industry profitability. The expected net profit of $35.6 billion is slightly ahead of the $35.3 billion recorded in 2015, as is the 5.1% net profit margin (slightly ahead of the 4.9% recorded for 2015). The modest revision from previous expectations largely is owing to two factors: Slower global GDP growth: 2.2%, which was below mid-year expectations of 2.3% growth. Non-fuel unit costs increased by 2.0% in 2016. Expected higher oil prices will have the biggest impact on the outlook for 2017. In 2016 oil prices averaged $44.6/barrel (Brent) and this is forecast to increase to $55.0 in 2017. This will push jet fuel prices from $52.1/barrel (2016) to $64.9/barrel (2017). Fuel is expected to account for 18.7% of the industry’s cost structure in 2017, which is significantly below the recent peak of 33.2% in 2012-2013. “Governments worldwide, however, do not make aviation’s work easy. The global tax bill has ballooned to $123 billion. Over 60% of countries put visa barriers in the way of travel. And the total number of ticket taxes exceeds 230. Billions of dollars are wasted in direct costs and lost productivity as a result of inefficient infrastructure. These are only some of the hurdles which confront airlines. Our aim is to work in partnership to help governments better understand and fully maximize the social and economic benefits of efficient global air links,” said de Juniac. Source: IATA - Another Strong Year for Airline Profits in 2017

Thread starter bagamoyo
Start date Dec 10, 2016

bagamoyo

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Dec 10, 2016

bagamoyo

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Dec 10, 2016

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