THE US AIRLINE industry could be on course to show its fifth consecutive year of losses in 1994, say early estimates from the Air Transport Association (ATA).
The warning confounds Wall Street predictions that the major airlines would end the year with net profits of $1 billion.
The major scheduled airlines were showing collective net profits of $540 million after the first three quarters of 1994, but the ATA warns that these could turn to losses after a poor final quarter beset by price cutting. At best, the industry could turn a profit of $200-$500 million for the year, says the ATA.
Since 1990, US carriers have lost nearly $13 billion. In 1992, the industry suffered a net loss of $4.8 billion, after the worst year in airline history. That loss was cut to just over $2 billion in 1993 and was expected to turn to profit in 1994. The ATA says, that although there were a record number of passengers in 1994, low airfares have continued to depress revenues.
Numbers in the US airline fleet remained stable during the year, edging up by only 100, to 4,450 aircraft. Airline employment was also virtually unchanged over the year at 537,000 staff.
Source: Flight International
