ATI reports that African carriers, represented by the African Airlines Association (AFRAA), have not escaped the downturn and are likely to suffer heavy losses in 2009.
AFRAA president and LAM Mozambique Airlines chairman Jose Viegas says first quarter profitability has been “quite poor”, after lower fuel costs and capacity adjustments failed to offset falling traffic and yields.
He adds that the world financial crisis will “most certainly hit African airlines during 2009″, causing record operating losses and significant budgetary constraint. “According to IATA research, Africa will be hit by losses of up to $300 million in operating results and $600 million in net profits,” says Viegas.
But the AFRAA president notes that “Africa hasn’t plummeted to the bottom line yet” and traffic volumes are expected to pick up from the third quarter of 2009.
Tourism is a key driver for the region and the 2010 World Cup is expected to boost passenger and cargo revenues in South Africa and neighbouring countries.
Viegas says: “Southern African airlines are facing an unprecedented crisis. In the last 12 months alone, some have filed for bankruptcy. The lack of cash flow has hit the region’s so called ‘big brothers’ too.”
He says the commercial aviation is “under pressure” and “shaky”, creating an urgent need for partnerships. He is backing stronger regional relationships, “energising” of some hubs, flight schedule co-ordination and other commercial co-operation as key ingredients in the recipe for recovery.
Related posts:
