The International Air Transport Association's (IATA) business confidence survey of airline CFOs and heads of cargo shows that airline profit expectations remain strong and confidence remains that air transport volumes will continue to grow. Input costs are expected to remain stable after declining in the fourth quarter due to cost-cutting measures.
Passenger yields are also expected to remain stable over the next 12 months, with cargo yields to remain unchanged, despite expectations of stronger volume growth.
Some 72% of survey respondents expect passenger travel to expand during the next 12 months but at a slightly slower pace. They also expect cargo volume growth to improve at higher reflecting the improvements in world trade growth.
Respondents also reported seeing better profitability in Q4 compared to the year ago period. Overall performance for 2013 overall was an improvement on 2012, with airlines in some regions seeing the benefits of consolidation and efficiency gains.
Passenger traffic increased during Q4 2013 and demand drivers remain broadly positive suggesting growth in passenger volumes in the months ahead will be at least at the current rate. The proportion of survey respondents expecting a rise in traffic volumes is 72%. Some 66% of respondents expect an increase in cargo demand over the next 12 months.