IATA Announcment - relevant....?
Date: 02 June 2008
Fuel Crisis a Catalyst for Change
Istanbul - The International Air Transport Association (IATA) called on governments, industry partners and labour to address the fuel crisis that is pushing airlines into the red. IATA forecasts a loss of US$2.3 billion for 2008 based on an average oil price of US$106.5 per barrel Brent crude. The association sounded a warning that this year’s loss could be even higher -potentially US$6.1 billion with an oil price at US$135 per barrel for rest of the year.
In the State of the Industry address at IATA’s 64th Annual General Meeting and World Air Transport Summit in Istanbul, Turkey, the association’s Director General and CEO, Giovanni Bisignani compared the airline industry to Sisyphus - a mythical character whose fate was to constantly carry heavy loads uphill.
“Over the last 60 years the industry made US$11.5 trillion in revenues, but only US$32 billion in profits. Average margin for the entire industry has been just 0.3%. And the industry is US$190 billion in debt. Since 2001, airlines achieved massive change. Fuel efficiency improved 19% and non-fuel unit costs dropped 18%. The skyrocketing price of oil has eaten these gains and left the industry in the red again. Oil prices at US$130 a barrel are changing the game for everyone. The situation is grim,” said Bisignani.
Bisignani sounded the alarm in a stark declaration to governments, industry partners and labour. “Airlines are struggling for survival and massive changes are needed. Governments must stop crazy taxation, change the rules of the game and fix the infrastructure. Labour must understand that jobs disappear if costs don’t come down. And to our partners, the message is simple. We are in this together. Don’t bite the hand that feeds you,” said Bisignani.
Interesting to note that a number of US Airlines are cutting back on flights, routes and people and they are all citing the high cost of fuel as well, any chance that theres something to this, or are they all just shouting management BS as a scare tactic.
No statement from me, just reporting what I've read, I'm sure their are people here who know more about whats going on then what I can read in the papers.