Airline Profits to Keep Rising in 2018

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IATA represents some 275 airlines comprising 83 per cent of global air traffic.

Airline companies around the world will end 2017 with 11 percent more profit than previously estimated for this year and continue profit growth into 2018, the International Air Transport Association said Tuesday.

This was contained in IATA's latest analysis of demand for passenger air transport.

"Safety performance is solid".

"We are eight years into this air travel cycle, but we see no reason at present to expect that cyclical pattern to repeat itself", IATA Chief Economist Brian Pearce said, with reference to a trend that would usually indicate a major downturn was due. "Airlines are achieving sustainable levels of profitability".

Of the $38.4 billion, $27.9 billion will come from North American and European airlines. While passenger numbers will rise six per cent next year, this year has seen an increase of 7.5 per cent.

In 2018, IATA forecast airline passengers to spend US$861b, or 1 per cent of world GDP, on travel.

They, and global cargo, will fly on an extra 1000 aircraft by the end of 2018 as the global fleet expands to over 30,000 aircraft, IATA said.

Domestic travel grew 7.2 percent in October, and capacity jumped 6.6 percent.

The growth in passenger numbers for SA (international and domestic) was expected to be between 3% and 4% a year for the next five years, according to projections by Airlines Association of Southern Africa.

In the Asia-Pacific region, including India, airlines are expected to register profits of $9 billion in 2018, which would be marginally higher than $ 8.3 billion projected for this year.

"More people than ever are traveling", he said. "Aviation is the business of freedom and a catalyst for growth and development", he said, adding the industry benefits to the economy include 2.7 million direct jobs and support for 3.5% of global economic activity. Turning to environmental concerns, IATA, which said the inflation-adjusted cost of flying had halved for consumers since 1996, said aviation was committed to managing its carbon footprint with a near-term goal of capping emissions through carbon-neutral growth from 2020. It is also an announcement of global passenger traffic results for October showing that demand (measured in revenue passenger kilometres or RPKs) rose 7.2 per cent, compared to the same month previous year.

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