US. “Bold changes are needed to ensure the long-term financial sustainability of the air transport industry,” said IATA director general Giovanni Bisignani, speaking at the opening of the IATA Annual General Meeting in Washington yesterday.
The successive impact of 11 September 2001, a world slowdown and SARS has been devastating. Airline industry losses in 2001 and 2002 amounted to US$25 billion. Bisignani characterised the last two years as being like “a boxer who gets hit harder after every knockdown.”
Bisignani noted that the travel industry is fighting back with cost reductions and efficiency gains. But this is not enough. He outlined the next steps in the industry’s fight for survival which include a new approach to labour relations and a new role for governments outlined in the Washington Declaration adopted by member airlines.
IATA traffic figures began to turn down in March, with mixed results among the major regions. For the first time in several months the passenger market showed a widespread negative trend. The month saw total scheduled international passenger traffic (in Revenue Passenger Kilometre terms) down -6.7% on March 2002. This was the first month since August 2002 where there was negative year on year growth. Carriers in Asia saw the first signs of the influence of SARS on traffic levels in March. All regions also had reductions in their passenger load factor compared to the same point in 2002.
“Outdated government regulations represent the strongest obstacles to change,” said Bisignani. In the Washington Declaration, airlines called upon governments to adopt six measures to foster change. They include the liberalisation of ownership rules to allow airlines access to global capital markets, increased standardisation between national competition authorities and restraint on discriminatory taxes and fees by governments.
Bisignani said that IATA supports regional liberalisation as a step towards “wide open skies” and a competition regulatory framework that will allow for airline consolidation.
“We cannot sit back and wait for better times,” said Bisignani.
