The International Air Transport Association (IATA) said Tuesday that 75 percent of airlines surveyed early in January indicated an improvement in year-on-year profitability in the fourth quarter of 2017 compared with the same period in 2016.
In its latest business confidence survey of airline chief financial officers (CFOs) and heads of cargo, IATA found that the majority (56 percent) reported that they expect their profitability levels to improve further over the coming 12 months.
This positive outlook is supported by robust demand growth on both the passenger and freight sides of the business. It said 86 percent of respondents expect passenger volumes to rise over the year ahead — the highest proportion in more than a decade.
A total of 38 percent of respondents reported an increase in input costs in the fourth quarter of 2017 compared with the same period a year ago, with many singling out the impact of higher fuel prices.
The airline association said, however, that the upward trend in oil prices is expected to continue to impact airline costs in the year ahead.
That said, partly due to the strength of the economic backdrop and current demand and supply balances, IATA’s respondents appear confident about the outlook for both passenger and freight yields over the year ahead…