Global airline profits are likely to be higher this year than initially expected. The International Air Transport Association (IATA) has revised up its forecasts despite slumping economies and high fuel prices.
The International Air Transport Association (IATA) said on Monday global airline profits were set to be healthier throughout the current year than initially forecast.
The lobby group representing 240 of the biggest international airlines raised its projected 2012 profits to $4.1 billion (3.2 billion euros) from its previous estimate of $3.1 billion.
"Airlines are keeping their heads above water better than expected, " IATA Director-General Tony Tyler told reporters in a conference call. He expected next year's global profits to rise to $7.5 billion.
"The industry has re-shaped itself by investing in new fleets, adopting more efficient processes, carefully managing capacity," Tyler added. "But despite these efforts, the industry's profitability still balances on a knife's-edge with profit margins that do not cover the cost of capital."
The IATA pointed to a series of global problems which it said continued to take their toll on business confidence.
"The European sovereign debt crisis lingers on," Tyler warned. "China continues to moderate its growth, and the impact of recent quantitive easing in Japan and the US will take time to yield growth."
hg/rg (AP, AFP, dpa)