BY MOHAMMAD SHOEB
DOHA: With an anticipated passenger traffic growth of over 11 percent, the Middle East’s aviation industry is expected to register nearly $2.2bn profitability in 2014, up 37.5 percent compared to last year, a senior official of International Air Transport Association (IATA) announced here yesterday.
“Despite global economic slowdown and industry challenges, the civil aviation industry in the Middle East is expected to register the fastest growth in the world,” said Anthony Concil (pictured), Director, Corporate Communication at IATA. He said: “The global profit of all airlines is estimated to hit $18.7bn in 2014 from $12bn in 2013, witnessing an impressive 55.8 percent growth, and the profitability of these airlines is expected to surge $2.2bn in 2014, up 37.5 percent compared to $1.6bn in 2013.”
He also said that the global revenue for 2014 is estimated to reach at about $745bn, however, due to stiff competition, rising fuel prices and weak cargo business, operators will have to content with only about 2.5 percent profit margin.
According to Concil, revenues from the air cargo business in 2014, despite weak business, are expected to reach nearly $63bn worldwide, which would constitute 8.4 percent of the total industry revenue. The business in the Middle East is expected to remain relatively much stronger than the global average.
He reiterated that increasing competition and rising fuel prices, which constitute nearly 30 percent an airline’s operation costs, will continue to remain as some of the biggest challenges faced by the aviation industry.
Concil was in Qatar as part of the preparations for the upcoming IATA Annual General Meeting to be held here from June 1 to 3, for the first time in the GCC region and after 17 years in the Middle East. Concil said that issues related to passenger rights, environmental resolution, rising fuel prices, innovation and the ‘New Distribution Capability’, an IATA-led initiative to develop an XML-based data transmission standard for communications between airlines and travel agents would be some of the important topics of discussion.
The open XML-based facility will enable travel agents and consumers easy and transparent access to the same products, services and other information that currently are accessible on airline websites. About 60 percent of airline tickets (by sales value) are sold by travel agents, including travel management companies and online travel agencies. The 70th AGM will bring together nearly 1,000 industry leaders, including CEOs from over 240 airlines and leading aircraft manufacturers.
This year’s AGM will coincide and celebrate the 100th-year of commercial civil aviation.
Qatar Airways (QA) will be the official host of the three-day event. QA has been a member of IATA since 1997, which represents nearly 84 percent of the global air traffic. In 2004, QA became the first airline to join the registry of the IATA Operational Safety Audit and has till date secured the audit consistently with 100 percent compliance.
The CEO of QA, Akber Al Baker, was last year voted onto the IATA board of governors.