MONTREAL – The airlines continue to feel the heat from the global economic downturn.
The credit crunch is the worst crisis to hit the international aviation industry since the outbreak of SARS, latest IATA research shows. 


IATA said a decline in the number of economy and premium passengers in August, was the first decline since 2003, when an outbreak of SARS slashed airline business. 


“Prospects for premium travel, business travel in particular, look very depressed,” the association says. 


“The financial sector crisis will surely see a very large shrinkage in business travel from this sector. 


“Moreover, the increased likelihood of recession in major economies next year will further weaken both business and leisure travel.”

IATA has meanwhile retained its forecast for a US$4.1 billion combined industry loss next year, stating that although fuel prices are now at half the recent peak, economies have “weakened sharply over the summer monthsâ€.
IATA added, “The industry is highly geared to the economic cycle and has always suffered substantial losses in previous economic downturns.”
