Airline business confidence remains strong, according to IATA's quarterly survey of airline CFO and heads of cargo in July, with 71% of respondents expecting an improvement in profitability over the next 12 months.
There is confidence over the growth of travel and cargo markets in the year ahead and, although yields are no longer expected to improve, the cost environment has stabilised. Part of the strength of confidence is due to the structural improvements that have taken place.
Passenger markets continue to outperform cargo, according to survey responses on recent past traffic volumes. Respondents foresee growth in both businesses over the next 12 months.
Input costs are reported to have declined during the recent past, with jet fuel prices now at the bottom of the 2-year range. Expectations for input costs have also been revised down to the no change level for the year ahead.
Passenger and cargo yields remained unchanged in Q2 2013 compared to the year ago period. The less optimistic outlook for yields over the next 12 months is consistent with easing input cost pressures.
There was no change in employment during Q2 and the trend is expected to continue over the next 12 months. This is a slight deterioration on April when some growth in jobs was expected.