European airlines fall further behind in their bid for recovery

8th June 2010

Europe fall behind in Airline Recovery.  

According to International Air transport Association, the aviation industry could recover from the economic downturn within 2 years.

European airlines are said to be falling behind as a result of the volcanic ash crisis.Giovanni Bisignani (Chief Executive) commented that strikes by airline staff, notably British Airways were " short sighted nonsense", bearing in mind the turmoil surrounding the industry.

Revenues have fallen by some 15 per cent during 2009 , and it was previously thought that recovery would take place within three years. He added that the economy was recovering strongly especially outside Europe and had been driven by economies improving faster than expected and boosting sales.  

He estimated  that the volcanic ash cloud incident had cost the industry around  $1.8 billion after a blanket closure of all airports for several days during April, and several ensuing short  term closures in May .

He noted that whilst Economic growth was steadily progressing in Asia and the U.S. it was lagging behind in Europe.

IATA  has forecast airlines  to make a profit of approximately 1.7 billion during 2010 but stated that European airlines are set for huge losses led by the troubled BA

Following the ash cloud and the Greek debt crisis, European airline share prices fell by a quarter  in May and are now off 20 percent this year — while U.S. airline shares are up 9 percent in 2010, IATA stated. Worldwide airline shares dropped by  15 percent in May, wiping out any  gains  already made this year.