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DateLine Sunday, 16 December 2007

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IATA's e-ticketing project ready by May 2008

The e-ticketing (ET) project initiated by the International Air Transport Association (IATA) will be completed by end May 2008.

According to the IATA survey on ET in October, Airlines said that they are projecting 93% ET by the end of this month and 97.7% by end May 2008. Airlines in all regions hope to exceed 95% by the deadline set with the exception of Africa 93% and CIS 87%.

IATA Director General and CEO Giovanni Bisignani addressing the Global media day in Geneva, Switzerland said that the IATA estimates a global industry profit of US 5.6 bln in 2007 and a drop to US 5 bln in 2008.

He said that the outlook for 2008 remains unchanged at US 5.6 bln. Higher oil prices were offset by strong traffic growth (5.9% for passenger traffic) and even stronger revenue growth of 8.4%.

Bisignani said that for the first time since 2000 they are profitable and it is good news, a lot of hard work by the airlines. Since 2001 non fuel unit costs dropped 16%, labour productivity is up 64% and sales and marketing unit cost decreased by 25% - yet with a 1.1% margin the bottomline is peanuts.

IATA sharply revised, downward its outlook for 2008 to US $ 5 bln from the previously forecast US 7.8 bln. The spike in fuel prices is expected to add US 14 bln to the industry's fuel bill, driving it up to US 149 bln.

The broadening impact of the credit crunch is expected to slow revenue growth to 4.7% and traffic growth to 4%. Simultaneously capacity expansion is expected to accelerate in 2008 with an increase in aircraft deliveries to 1,281 up from 1,041 in 2007.

He said that the challenges will be tougher in 2008. A favourable economy, environment and effective efficiency measures helped mitigate the impact of high fuel prices and underpinned profitability improvements.

However, with the international credit crunch the situation is changing. The peak of the business cycle is over and we are still US 190 bln in debt and therefore could be heading for a downturn with a little cash in the bank to cushion the fall, said Bisignani.

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