Airlines poised to lose $11 billion this year

As each day passes, the financial plight of the airline industry gets worse. Falling passenger traffic due to the recession, and moderately high fuel prices due to $70 per barrel oil, are squeezing margins into the red at debt-laden carriers. Japan Airlines said, on September 15th, that it would cut 6,800 workers as it looks for a carrier partner in the U.S. or Europe to give it a desperately needed cash infusion.

The International Air Transportation Association (IATA) put a specific number to the industry's woes in its new survey of the sector; airlines will lose an aggregate $11 billion this year, according to the group. That figure is $2 billion more than IATA's last forecast. The association added, "Industry revenues for the year are expected to fall by US$80 billion (15%) to US$455 billion compared with 2008 levels." The impact of falling traffic over the last two years is greater than that of 9/11, the IATA's chief said.