News

The International Air Transport Association (Iata) has expressed its confidence in the airline industry in 2007, raising its profit forecast for the sector.

Having projected a net profit of US$5.1 billion (£2.56 billion) in June, the association now forecasts earnings of $5.6 billion for 2007.

Efficiency gains in recent years have contributed to carriers' financial success, with Asia-Pacific based airlines adding 42% to their capacity since 2001 and European operators boosting their carrying potential by 29%.

Factors such as these combined with strong passenger demand, which offset rising oil prices, prompted Iata to revise its profit forecast, but the association said that conditions could change next year.

Director general Giovanni Bisignani said: 'While we are more optimistic for 2007, the continuing high price of oil combined with turmoil in credit markets is a cause for concern in 2008.

'The impact of the credit crunch puts some question marks over the industry's performance next year and the continuing high price of fuel will become more difficult to mitigate with efficiency gains.'

Opodo searches thousands of flights from over 500 airlines to find the best flight deals for travellers. Find flights.

© Adfero Ltd