Business News of Sunday, 13 December 2015
The 2016 outlook released by the International Air Transport Association (IATA), forecasts, in general, a promising year for the industry, with an average net profit margin of 5.1% being generated with total net profits of $36.3 billion.
“The airline industry is delivering solid financial and operational performance,” IATA’s director general and CEO, Tony Tyler said.
According to him, “Passengers are benefiting from greater value than ever—with competitive airfares and product investments.”
Africanaerospace has analysed that the industry has been strengthened by lower oil prices, a strong demand for passenger travel, strong economic performance in key economies, such as the recovery in the Eurozone, and increased efficiency indicated by high load factors and increased capacity.
The price of oil is currently under the $40 per barrel mark. Meanwhile, the 2016 IATA outlook foretells bad times for African Airlines. It forecasts continuing losses for the continent’s airlines.
They are expected to be in debt in both this year and next year, with losses of $300 million and $100 million, respectively.
Profit per passenger stands at -$3.84 in 2015, and forecast to be -$0.93 during 2016, reflecting the impact political instability has had on the tourism markets in North Africa.