Airlines Across the World in Trouble : Kathika Travel Website

Who would want to be an airline owner these days? The doom and gloom for airlines just keeps adding up: increased fuel costs and the double effect of economic problems – fewer people can afford to fly, and the airlines’ finances themselves might be a bit unstable too. Problems with regulations preventing mergers and takeovers have also left many airlines vulnerable.

50 Airlines to Go Bust in 2008

If you listen to the dire predictions from Giovani Bisignani, the boss of the International Air Transport Association (IATA), then things are looking particularly grim for airlines. With twenty-six airlines already going to the wall during 2008, he predicts that this number could still double before the year is through.

That might mean that travelers need to be extra careful when they are booking flights, especially if they are for dates further down the track – think twice (or do some research) about how stable the airline is and have a Plan B if things go wrong. And remember that it’s not just airlines who are in trouble – tour operators have also come under attack as a result of the economic crisis.

Airlines Lose Over $5 Billion in 2008

The airlines that do survive will likely be facing large losses and increasing debts. According to the IATA, the global airline industry put together is likely to lose about US$5.2 billion during 2008, with the main factors being the rising cost of fuel and falling demand from travelers affected by economic problems. The growth in passenger demand has fallen to its lowest levels in five years and doesn’t look like it will improve.

Indian Airlines Having More Problems Than Expected

One sector of the airline industry that we have heard little about, but might hear more about soon, are the Indian airlines. Although the local airline industry in India had been progressing well, things are now looking bad and $1.5 billion of the global losses to airlines this year will probably belong to Indian airlines. High taxes have become a big problem and made the industry somewhat uncompetitive, and many think that this needs to change. It has also been said that the operating standards need to reach global standards to ensure the industry is safe – both from a physical safety viewpoint and economic safety.

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