Global airline industry's 2018 net profit expected to rise: IATA

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Passengers have directly contributed to the growth in profit, as the average net profit per departing passenger is expected to rise to $8.90 (up from $8.45 in 2017).

In a statement today, IATA said, passenger capacity grew by 6.2 per cent and load factor climbed 0.8 percentage point to 80.8 per cent year-on-year (y-o-y). "One of the concerns we have is the unprofessional operation of small recreational drones because people do not understand the risks they could have against manned aviation", he said. A strong upcycle in the cargo markets will also support the expected profit improvement next year, it added.

Strong airline profitability is expected to continue in 2018, according to IATA's latest financial forecast.

The biggest challenge to airline profits was still rising costs, specifically oil prices and labour costs. The demand for air cargo is at its strongest level in over a decade. "More routes are being opened", he told the IATA global media conference in Geneva, Switzerland. "Despite the challenges, there is positive momentum heading into 2018", said Iata, whose 280 members account for more than three quarters of global air traffic.

Aside Africa, virtually all the continent's airlines from Asia Pacific, Europe, Middle East, North America and Latin America recorded appreciable traffic growth.

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"Broadly speaking, South-east Asian airlines' operating profits and profit margins are expected to be lower year on year in 2018, if fuel prices remain at current levels or rise further", said Corrine Png, chief executive of transport research firm Crucial Perspective.

"The industry also faces longer-term challenges", de Juniac acknowledged. Turning to environmental concerns, IATA, which said the inflation-adjusted cost of flying had halved for consumers since 1996, said aviation was committed to managing its carbon footprint with a near-term goal of capping emissions through carbon-neutral growth from 2020.

He said: "To continue to deliver on our full potential, governments need to raise their game-implementing global standards on security, finding a reasonable level of taxation, delivering smarter regulation and building the cost-efficient infrastructure to accommodate growing demand".

October worldwide passenger demand rose 7.3% compared to October 2016, which was an improvement compared to the 6.6% demand increase for September.

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