Global airline industry set to lose 3.3bn in 2008

Global airline industry is set to lose £3.3bn ($5bn) this year as a result of the global economic downturn. According to industry body, International Air Transport Association (IATA), losses will amount to £1.68bn next year and affect all regions.

The IATA director general Giovanni Bisignani says that the outlook is bleak and that the “chronic industry” crisis will continue into 2009, though the US will be the least hit.

The latest IATA figures are still an improvement on the forecast it made in September when it predicted a loss of $5.2bn (£3.5bn) in 2008. The IATA has downgraded the loss to £3.3bn ($5bn) due to the recent decline in fuel prices.

The body adds that passenger traffic is also likely to fall 3% in 2009, against the 2% growth reported this year. The fall will be the first since 2001. “We face the worst revenue environment in 50 years,” Bisignani says.

IATA expects the economic slowdown to affect the global travel industry, resulting in as many as 400,000 employees losing their jobs.

British Airways has already announced to cut more than 100 jobs at London’s Gatwick airport as it plans to reduce services by 15% from mid-2009.

The IATA represents around 240 airline companies globally.