Airlines anticipating a return to profitability

By Alexander G. Higgins
Associated Press

GENEVA — World airlines, still suffering heavy losses, expect to return to the black next year with a net profit of $2 billion on international scheduled services, a spokesman for an airline group said last week.

The International Air Transport Association said the net loss for this year would be $5 billion, with travel across the Atlantic and Pacific oceans down sharply from previous years.

The estimates come from information provided by the association's 275 member airlines.

"It will take about six years for trans-Pacific to be back to the level of 2000," said association spokesman William Gaillard.

Other areas will recover more quickly from the travel cutbacks, which last year alone cost the industry $12 billion in losses on international scheduled services.

Asia and Europe are the bright spots, the association said. Traffic to and from the United States will continue to pull down overall results for several years, but North Atlantic travel will recover before the Pacific.

Passenger numbers within the United States also continue well below pre-Sept. 11, 2001, levels, but the association forecast only deals with flights between countries, Gaillard said in a telephone interview.

For long-term prospects, "the only bad news really is trans-Pacific," he said. "The Japanese are afraid to go to the U.S."

Air travel within Asia, however, is expected to continue strong, he said.

"By 2006 we see Asia doing extremely well," he said. International passenger travel in the region is expected to be 30 percent better than it was in 2000.

The next best area will be Europe-Asia passenger traffic, which is forecast to be 25 percent better than 2000. Flights within Europe will trail only slightly.

The association forecast said it would take until the beginning of 2005 for North Atlantic passenger traffic to recover to the level of 2000. It will take another year for trans-Pacific travel to recover.

"The Americans are not flying much, so they are not going to Europe as much as they used to, and the Europeans don't think that going to the U.S. is a great idea. They still go, but not the way they did before," Gaillard said.

Travel to and from China is expected to rise most strongly.