Industry profitability improves but cargo still in “doldrums”: IATA
Cargo yields are expected to fall by 8.0 per cent this year and overall cargo is expected to generate $49.6 billion in revenues, down from $52.8 billion in 2015.
June 2, 2016
By Donald Urquhart
The International Air Transport Association (IATA) revised its 2016 financial outlook for global air transport industry profits upwards to US$39.4 billion (from $36.3 billion forecast in December 2015). That is expected to be generated on revenues of $709 billion for an aggregate net profit margin of 5.6 per cent. 2016 is expected to be the fifth consecutive year of improving aggregate industry profits.
The cargo side of the business, however, remains in the doldrums with 2.1 per cent growth in demand. Airlines are growing their fleets with long-haul wide-body aircraft to meet strong passenger demand growth. This adds cargo capacity to a flat air cargo market. Cargo yields are expected to fall by 8.0 per cent this year. Overall cargo is expected to generate $49.6 billion in revenues, down from $52.8 billion in 2015.
In 2015 airlines generated a global aggregate profit of $35.3 billion (re-stated from $33.0 billion estimated in December 2015). All regions are making a contribution to the $4.1 billion boost over 2015 profits with improved results; but there are stark regional differences in performance. Over half of the industry profits will be generated in North America ($22.9 billion) while African carriers are forecast to continue generating an overall loss (-$0.5 billion).