Air Transport World

Eser leaving a stronger IATA. (International Air Transport Association Director General Gunter Eser; includes related article on Iraqi Airways' need for aircraft maintenance)

MONTREAL-- Director General Gunter Eser painted a dour portrait in his annual "State of the Industry" message to the 48th annual general meeting of the International Air Transport Association. As predicted (ATW, 10/92) he told delegates that financial performance has been grim for the past two years and things are not expected to be much better for 1992 or '93.

In describing the state of the industry, Eser said: "The word 'apocalypse' comes to mind." He said that despite international scheduled traffic gains of about 14% in terms of revenue tonne kilometers this year compared with last--the year of the Gulf War--IATA member airlines probably will suffer losses of $2.6 billion after interest charges. He expects some improvement for next year, but expects losses of $600 million and noted that if these figures don't improve, net losses for the four years 1990-93 will total just under $10 billion.

Eser, who retires Jan. 1, has seen the industry and the organization swing from the U.S. Civil Aeronautics Board's showcause order that made IATA membership virtually illegal. Now, nearly all U.S. majors are full-fledged tariff coordination members.

Addressing his last AGM, he developed the apocalypse theme, saying the "Four Horsemen" are too-low traffic and yields, too-high capacity and unit costs. He then said there also is a fifth horseman, airline debt levels, which he described as too high to be sustainable. The DG noted that airlines' interest charges have doubled since 1987, reaching $3.4 billion in 1991, helping to drag down net result to a $4 billion loss. …

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