Tuesday, January 27, 2009

Asia Pacific Airlines Brace for Turbulent Year

Asia Pacific Airlines Brace for Turbulent Year
(Cargonews Asia)

The Association of Asia Pacific Airlines (AAPA) today [Friday] released preliminary traffic figures for the full year 2008, and it makes for grim reading.

AAPA international air cargo traffic for 2008, expressed in freight tonne kilometres (FTKs), suffered a significant decline, ending the year 6.1% lower than the record set in the previous year. Member airlines reduced cargo capacity accordingly, but the average cargo load factor for the year still fell by one percentage point to 65.6%.

Commenting on the 2008 results, Andrew Herdman, AAPA director general said airlines were battered by skyrocketing oil prices followed by rapidly weakening demand as the effects of the global economic downturn ricocheted around the world.

"The situation in the air cargo market was dire, as demand for air cargo collapsed in the second half of the year, registering increasingly steep monthly declines," he said. "December volumes were down by a shocking -24% compared to the same month a year ago."

Herdman added that with no sign of any respite amid the global economic downturn, Asia Pacific airlines are braced for another extremely difficult year.

Commentary: 24% down appears better than the 26.66% prediction for containerships. I can't imagine how shocked they would be regarding oil prices as is not hedging jet fuel prices and stockpiling a common practice among Asian Airlines? Would it not be better for them to operate at significant losses and offer Ryan Air type rates to maintain altitude for the unforseeable future? Has no one at the AAPA heard of scenarios planning? I would really like a $99 dollars return flight to Cebu from Inchon right about now to wash away some of the grim direness.

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