Global airline profit expected to rise to 35.5 bln USD in 2019: IATA

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The global airline industry net profit is expected to be 35.5 billion U.S. dollars in 2019, slightly ahead of the 32.3 billion dollars expected net profit in 2018, the International Air Transport Association (IATA) forecast Wednesday.

It is expected that 2019 will be the tenth year of profit and the fifth consecutive year where airlines deliver a return on capital that exceeds the industry's cost of capital, said IATA at its annual international media day here.

"We had expected that rising costs would weaken profitability in 2019. But the sharp fall in oil prices and solid GDP growth projections have provided a buffer," said Alexandre de Juniac, IATA's Director General and CEO.

He said IATA is cautiously optimistic that the healthy state of the airline industry for investors will continue for at least another year.

"Air travel has never been such a good deal for consumers. Some 1,300 new direct links between cities opened in 2018. And 250 million more journeys by air occurred in 2018 than in 2017," said de Juniac.

He cautioned, however, that there are downside risks as the economic and political environments remain volatile.

Lower oil prices and solid, albeit slower, economic growth (up 3.1 percent) are extending the run of profits for the global airline industry after rising costs squeezed profitability in 2018.

All regions, except Africa, are expected to report profits in 2018 and 2019.

Carriers in North America continue leading on financial performance, accounting for nearly half of the industry's total profits. North American carriers are expected to deliver the most robust performance in 2019 with a 16.6 billion dollars net profit, up from 14.7 billion dollars in 2018.

Asia-Pacific carriers are expected to report a 10.4 billion dollar net profit in 2019, up from 9.6 billion dollars in 2018.

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