End of US-China Trade War: A key to stronger 2020 for global Airlines

Airline profits globally will rise in 2020 after a tough 2019, the International Air Transport Association (IATA) forecast on Wednesday, but only if there is a ceasefire in the US-China trade war to lift the industry’s outlook for the year ahead.

Predicting a stable outlook for the next 12 months, Brain Pearce, the association’s chief economist, said any expectation of higher profits was “contingent on a truce” between the two warring economic superpowers.

The cautiously positive tone masked a softening in global airline profitability in 2019, revised down by 7.5 per cent to US$25.9 billion, with slowing economies and the trade friction the aggravating factors.

“We do see some scope for stability, for a more stable 2020 than we certainly had [this year],” Pearce said at a media event in Geneva.

Airline profits collectively in 2020 will reach US$29.3 billion, a rise of 13.1 per cent, the association predicted, while airlines in Asia-Pacific, who have been most exposed and impacted by the trade war, would improve to HK$6 billion next year.

Read here