Airline earnings?will be 20 percent higher this year than forecast just three months ago as capacity cuts help pack planes to record levels, the?International Air Transport Association?said today.
Carriers are likely to generate net income of $12.7 billion in 2013, the industry group said today. That compares with a forecast of $10.6 billion issued on March 20, and represents a 67 percent gain on last year?s profit of $7.6 billion.
Airlines, set to carry more than 3 billion people for the first time this year, have resisted adding seats to chase market share. The strategy should lift their average?load factor, or seat occupancy, to a record 80.3 percent, IATA Chief Executive Officer?Tony Tyler?said at the group?s annual meeting.
?Airlines have done a pretty good job of being profitable in very difficult circumstances? that include rising oil prices and slowing economic growth, Tyler told airline executives assembled inCape Town?today. Even with the improved outlook, the industry?s earnings will equal just 1.8 percent of its $711 billion in revenue, trailing a profitability high for the past decade of 3.3 percent set in 2010.
Carriers in all regions should post a profit this year, led by airlines in Asia with projected earnings of $4.6 billion and?North America?with $4.4 billion, IATA said.
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Source: Robert Wall & Kari Lundgren (2013). IATA Raises Airline Profit Forecast 20% on Seat Occupancy, Bloomberg?http://www.bloomberg.com/news/2013-06-03/iata-raises-airline-profit-forecast-20-on-seat-occupancy.html published Jun 03, 2013. Viewed Jun 05, 2013.