IATA sees sky brightening in May's air cargo figures

THE International Air Transport Association's (IATA) Airlines Financial Monitor says the world air freight picture brightened in May, but excess capacity has forced yields down at a faster pace.

Airline stock prices fell two per cent in June as equity markets worried about the cash squeeze on the sector as net losses exceeded US$3 billion in the first quarter, consistent with the industry association's forecast for 2009 of a total net loss of $9 billion industry wide, said IATA chief economist Brian Pearce.

Oil and jet fuel prices have increased over 30 per cent or US$20 a barrel since early May, he said, which squeezes airline cash flows further. The industry continued to resize with further capacity cuts in May to meet the demand slump, he said.

"New aircraft deliveries slowed a little to 96 in May, but there were few retirements so the global fleet continues to expand," said Mr Pearce.

Source: News and Data Online