Europe Beats Asia in Airline Profitability
e-Travel Blackboard | Sep. 07, 2006
Data released by the Centre for Asia Pacific Aviation has found that at the beginning of the year, Asia-Pacific airlines were expected to lead the way in international industry profitability in 2006. IATA also projected a profit of USD2 billion and stated that the low labour costs and strong long haul markets were some of the key features of a projected success in the region.
However, these outlooks are set to be disproved, with figures suggesting that European carriers will be the most profitable region this year, with a USD1.8 billion net profit this year.
IATA has stated that Asian carriers have been greater affected by rising fuel prices because of lower hedging levels compared to European airlines.
The Centre's Executive Chairman, Peter Harbison commented: "While Asian carriers have generally enjoyed stronger rates of passenger growth in 2006 after trailing Europe and the global rate last year, European carriers are more profitable, and the difference appears to be yields and fuel management."