Air Transport World

Red ink in Europe; AEA carriers report highest-ever loss - $2.5 billion - for 1990, despite traffic growth. (Association of European Airlines)

LONDON-THE 22 members of the Association of European Airlines (AEA) recorded their highest-ever loss, estimated at $2.5 billion after interest, during 1990, according to a report for the year by the Brussels-based organization.

The loss came about despite the fact that passenger traffic for the year rose by 8.3%. AEA said that the comparatively favorable relationship between yield and cost development that the member airlines enjoyed for most of the 1980s took "a massive turn for the worse" last year, when the industry was impacted by a chain of circumstances, all of which had adverse effects on either their costs or revenues.

The Iraqi invasion of Kuwait in early August occurred as the airlines were facing the imperative tasks of revenue improvement and further cost control. …

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