* International cargo traffic falls, passenger demand weak
* IATA sees no early economic recovery, says outlook "bleak"
(Adds details, background)
By Laura MacInnis
GENEVA, July 30 Airlines carried 16.5 percent
less cargo and 7.2 percent fewer people in June than the same
month a year ago, with no sign yet of the global recession
lifting, an industry body said on Thursday.
In its latest monthly reading of cross-border traffic, the
International Air Transport Association said it could take years
for air freight -- a leading indicator of the health of world
trade -- to return to 2008 levels.
"These are extremely challenging times for airlines. There
are no signs of an early economic recovery," IATA said, warning
that continued weakness could spell trouble for carriers.
"Airlines are seeing international revenue falls of up to 30
percent at the start of the busy June-August period when
airlines traditionally make their money. The outlook remains
bleak," IATA Director-General Giovanni Bisignani said.
IATA has estimated airlines will lose $9 billion in 2009
after shedding $8.5 billion in 2008, when high oil prices hit
profits amd then the global credit and financial crisis slashed
demand for business and leisure air travel. [ID:nL8380291]
The Geneva-based body, which represents 230 carriers
including United Airlines UAUA.O, Cathay Pacific (0293.HK),
Emirates [EMIRA.UL] and British Airways BAY.L, said there were
further risks in 2009 from rising oil prices and fears of the
H1N1 pandemic flu that could further suppress passenger demand.
Air cargo traffic has fallen for 13 consecutive months on a
year-on-year basis, reflecting both fewer shipments of goods for
sale and the reliance of some exporters on more ocean transport
during the recession, which has weakened consumer demand.
"At the current pace, it will likely take several years
before demand returns to early 2008 levels," IATA said of cargo.
IATA said there were some signs of increased activity in
China and other emerging Asian countries in June, but said these
were eclipsed by weakness in Europe and North America where
consumers "choose to repay debt rather than increase spending."
Airlines have been slashing fares in both business and
economy class to encourage people to keep flying during the
recession, and "after years of cost reduction, the scope for
further cuts is limited," IATA warned.
"Flexibility is critical in finding new sources of capital
and new markets," it said.
(For the full IATA statement, see: www.iata.org)