Regional Breakdown for 2010

While all regions except Africa will see an improvement in 2010 compared to 2009, performance will vary greatly as follows:

North American carriers will see losses reduced from US$2.9 billion in 2009 to US$2.0 billion in 2010. The relative improvement is largely the result of pricing power and cost reductions gained through capacity adjustments.

European carriers will generate the largest losses of any region at US$2.5 billion. This is an improvement over the US$3.5 billion loss that the region carriers are expected to post in 2009. Slow economic recovery in the region combined with limited ability to adjust capacity due to airport slot regulations is hindering the region airlines.

Asia-Pacific carriers will post losses of US$700 million. Compared to losses of US$3.4 billion in 2009, this region is showing the most dramatic improvement. This is driven by a recovery in some of the region economies. For example, China GDP is forecast to grow by 9.0% in 2010.

Latin American carriers will be the only profitable regional grouping in both 2009 and 2010. The profit in each year is expected to be US$100 million. This is largely due to the benefit of relatively strong economies in South America and the efficiencies gained through regional airline structures.

Middle East carriers will see losses shrink from a US$1.2 billion loss in 2009 to a US$300 million deficit in 2010. A strong long-haul connection business over Middle East hubs will provide some insulation against the impacts of Dubai financial difficulties.

African carriers will deliver a loss of US$100 million in 2010, consistent with the US$100 million loss of 2009. Relatively strong economies and increasingly liberal markets are being offset by competitiveness challenges.