IATA cuts its profit target for airlines

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Global airlines have trimmed their profit forecast for this year by 8 per cent because of weaker growth in Asia and a slowdown in freight shipments.

The International Air Transport Association, which represents about 240 carriers, expects the industry to turn in a profit of $11.7 billion (£7.3bn) for 2013, down from the $12.7bn forecast it made in June.

The trade body also highlighted the spike in oil prices driven by the crisis in Syria and “disappointing” growth in several key emerging markets across Africa and the Asia Pacific region, although profit forecasts were raised for European and North American airlines.

Chief executive Tony Tyler said profits this year would still be “considerably better” than 2012’s figure of $7.4bn, and earnings are predicted to rise to $16.4bn next year.

He added: “We have run into a few speed bumps. Cargo growth has not materialised. Emerging markets have slowed.

“We do see a more optimistic end to the year. And 2014 is shaping up to see profit more than double compared to 2012.”