Airline bosses show confidence in further market improvements

#IATA’S BUSINESS CONFIDENCE SURVEY GIVES THUMBS UP TO THE INDUSTRY

(Posted 30th January 2018)

IATA

Key points:

  • When surveyed in early-January, 75% of airline CFOs and Heads of Cargo indicated an improvement in year-on-year profitability in Q4 2017 compared with the same period in 2016. The majority (56%) reported that they expect their profitability levels to improve further over the coming 12 months.
  • This positive outlook is being supported by robust demand growth on both the passenger and freight sides of the business; 86% of respondents expect passenger volumes to rise over the year ahead – the highest proportion in more than a decade.
  • 38% of respondents reported an increase in input costs in Q4 2017 compared to the same period a year ago, with many singling out the impact of higher fuel prices. The upward trend in oil prices is expected to continue to impact airline costs in the year ahead.
  • That said, partly as a result of the strength of the economic backdrop and current demand/supply balances, our respondents appear confident about the outlook for both passenger and freight yields over the year ahead; both the forward-looking weighted-averages scores are currently above the 50-mark.
  • The outlook for industry employment over the next 12 months remains positive, with 37% of respondents expecting to increase employment and a similar proportion expecting to maintain current levels.

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