Air Transport World

IATA DG concerned about financial woes of some member airlines. (Gunter O. Eser)

Geneva--Chairmen, CEOs and senior executives of the International Air Transport Association airlines come together at their annual meeting in Hamburg, West Germany, later this month against a background of increasing worries that the industry is splitting into "have" and "have-not" airlines in financial terms. Gunter O. Eser, appointed director general at last year's AGM in Montreal to succeed Knut Hammarskjold, has already homed in on this problem at IATA headquarters here, pointing out that in 1984 some 40 member airlines showed a total profit of $1.7 billion on scheduled international service while the rest produced a deficit of $1.2 billion. System financial results for IATA carriers in 1984 show an operating profit of $3.5 billion, up a whopping 150%. Net profit was $1 billion compared with a loss in 1983 of $300 million.

Eser estimates that IATA member airlines will need to invest some $147 billion, a "daunting" sum, in new equipment more per year "to bring our neglected automation capabilities up to scratch." While carriers in Asia, Europe and the U.S. may be able to re-equip adequately, the problem confronting those in Africa and Latin America is "a real headache, given the economic problems confounding their governments, and their financial state."

According to Dr. Eddie Spry, IATA senior director for economics and industry finance, there has been a change for the better in the overall financial performance of the air transport industry, with profits of $500 million last year in IATA member international scheduled service and a similar figure estimated for 1985. …

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