Airlines are poised to post higher-than-expected profits this year, but the turning point investors have been dreading may be near as traffic growth slows and oil prices inch up. The IATA Thursday raised its profit forecast for the global air transport industry to a record of $39.4b for 2016 even as traffic growth is slowing and terrorist attacks hurt demand. Airlines made $35.3b last year and IATA, in December, projected $36.3b for this year. Carriers in North America are poised to lead the way in 2016 with $22.9b in net profit, IATA said. The outlook for European profit has weakened as terrorist attacks in Paris in November and Brussels in March weigh on demand. European carriers now are expected to collectively post $7.5b in profit, $1b less than anticipated six months ago. Profit growth is underpinned by the sharp drop in oil prices since mid-2014. IATA said fuel should be about 19.7% of airline costs this year, down from 33.1% in 2012-2013 and about 27% last year. “We are probably nearing the peak of the positive stimulus from low oil prices,” said Tony Tyler, the airline trade group’s CE. Airline consultant the Centre for Aviation said this week that operating margins for the world’s airlines would peak in 2016 at 8.2%, up from 7.1% in 2015. Margins are expected to retreat next year to around 7.5% as airlines introduce more planes adding downward pressure on ticket prices. After five years of profit increases the pace of growth is slowing, said Brian Pearce, chief economist at IATA. “The main worry we have is the fragility of the world economy.”<br/>
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Airlines expect to agree by the end of 2016 on the best way to quickly recover data from the so called 'black boxes' on every plane that record flight information and help shed light on the causes of air disasters. The black box recorders from EgyptAir MS804 are still being sought two weeks after it disappeared over the Mediterranean enroute from Paris to Cairo with 66 people on board. Aircraft tracking has been a high priority since Malaysia Airlines MH370 disappeared over water in 2014. ICAO said in March that new aircraft needed to be equipped by 2021 with improved means of having their black boxes or data from them recovered in a timely manner. Airlines and plane manufacturers are exploring ways to meet that goal, including ejectable recorders or other technology such as new homing methods or data streaming. Ejectable or "deployable" recorders would separate from the tail during a crash and then float while emitting a distress signal. A data streaming system would create huge amounts of data for all aircraft. Gilberto Lopez Meyer, senior VP for safety and flight operations at the IATA, said Thursday the organisation would by the end of 2016 state its view on which of the possible techniques would be best.<br/>
Airlines are opposed to screening passengers just before they enter an airport, with such steps -- widely proposed after the March 22 bombings in Brussels -- likely to increase waiting times and prove ineffective in preventing attacks, the IATA said. Carriers instead favour the streamlining of security through a risk-based approach and wider adoption of more modern systems including self-service technology that would raise the hurdles facing would-be terrorists, IATA CEO Tony Tyler said Thursday. The trade body takes the view that curbside screening would not only lengthen lines and expose travelers to inclement weather outside the terminal, but also create large crowds that could themselves become the target of attacks. The Brussels Zaventem hub adopted scans for people seeking to enter its buildings after terrorists exploded bombs in the departure hall, killing 11 people and injuring more than 80. Passengers in India must present their ticket and proof of identity on arrival and have their bags screened and sealed. Tyler said states should make full use of "known-traveller" data provided by carriers. Used mainly in the United States, such programs expedite processing of frequent flyers so that security is focused on the most likely transgressors, he said. IATA also backs risk-assessment of passengers by providing governments with advance information on customers, Tyler said. "The current system of airport screening is effective but extremely expensive," the CEO said. "Passengers routinely rate it as the worst aspect of their journey." Rising traveller volumes are another reason for seeking smoother processing, with existing mechanisms unlikely to cope with increases, he said.<br/>
The boss of Emirates Airline, the world’s largest international airline, Thursday said recent attacks on commercial aviation show security structures to protect the flying public are insufficient. “In my view we are not doing enough. We have had so many wake-up calls in the last couple of years, it is clear we have to do a lot better than we have been doing,” Emirates Airline President Tim Clark said. Commercial aviation has been hit by a series of terror attacks. A Russian jetliner departing Egypt’s Sharm El Sheikh airport was downed last October in a suspected bombing killing all 224 people onboard. An explosive also was smuggled onto a Daallo flight departing Mogadishu, killing the suspected bomber. And on March 22, two bombs detonated at Brussels Airport killing 16 people. The view that security isn’t tight enough was echoed by THAI CE Charamporn Jotikasthira. “We still need to improve over time. No change is not an option,” he said, Bernard Gustin, chief executive of Brussels Airlines whose hub airport was hit by the attack almost little more than two months ago said terrorists need to be stopped before they reached the airport. “It’s with the intelligence systems that it needs to be solved,” he said.<br/>
During his career in airports, Andrew Price has seen travellers try to check in engines, a fridge so big he could stand inside it and a plastic carrier bag fastened just with staples. Passengers arriving with such unlikely flight baggage may be something he can never solve, but the problem of lost bags is coming under renewed attack. Solutions ranging from suitcases that incorporate trackers to electronic ink displays and home-printed bag tags are increasingly being applied in an effort to cut the irritation of the 23m bags that do not land with their owners each year. “The traditional barcode [tag] has served us well for 35 years,” says Price, head of airport operations at IATA. But, he adds, “there is some really promising stuff happening in terms of tracking bags”. On his estimate, the number of barcode stickers — made of silicon, adhesive, paper and plastic — used on flights each year could be tagged “end to end 35 times around the planet. We really should be looking to get away from that.” Like others in the airport industry, he is enthused by the many technological solutions emerging, such as those being added by suitcase makers. WiFi hotspots, Bluetooth, SIM cards, GPS and built-in batteries are all being embedded into luggage to help owners ascertain where their belongings are — or where they were the last time they showed up on the system. However, it is up to passengers to buy these cases, which typically cost hundreds of dollars. Iata is leading the drive to cut the number of delayed bags by requiring all airlines to track cases by 2018. Those that have started to use tracking, in the same way that parcels are tracked in the mail, have cut mishandling rates by a third, says Price. His target is for the 6.5 misplaced bags for every 1,000 handled to fall to 4.5 by 2020.<br/>
A bid by House Republicans to shift the federal air-traffic control system to a nonprofit corporation’s control has been sidelined by bipartisan Senate opposition, according to congressional staffers, airline industry officials and others participating in the process. Continuing disagreements between senators and the Republican chairman of the House Transportation and Infrastructure Committee over a FAA reauthorisation bill have created a legislative logjam, these people said, likely to last until at least next spring or summer. The anticipated result is that the agency will be hobbled with another brief, stopgap funding bill that all sides had hoped to avoid. Such an outcome would maintain the FAA’s basic spending levels and programs, while prompting uncertainty about new policy initiatives and leaving the agency without longer-term financial stability that would benefit its efforts to modernize the nation’s aging air-traffic control system.<br/>
The “divesting” of shoes, laptops, and toothpaste tubes, to use the US TSA’s term, has been one factor in the airport security lines entangling US travellers this spring. The agency’s PreCheck program is designed to fix that problem and move the lines—but only 2.77m people have enrolled to date, far below projections. The TSA wants to have 25m people signed up by 2019 for federal “trusted traveler” programs such as PreCheck, for domestic travel, and Global Entry, the program for international travelers run by the US Customs and Border Protection. Efforts to push TSA PreCheck were galvanized this spring by weeks of frustratingly long security lines which quickly spiked enrollments. Daily applications jumped to 16,000 in May, double the rate of the prior month. “I won’t say we were caught off guard with this, but I will tell you the surge happened much more rapidly than anyone could anticipate,” said Charlie Carroll, a senior VP at MorphoTrust USA, which runs the program. But according to the US, Travel Association, a lower fee and simpler application process would spur 7m more people to enroll in the PreCheck program. In a statement Thursday, the group based its claim on a survey of 1,000 domestic travellers conducted March 7-10. Of the 1,000 people, 20.5% said they would likely enroll in PreCheck. Among the rest, half cited the $85 fee as the reason they would probably not enroll. <br/>
Chinese travellers are spending more time at airports and on aircraft as flight delays worsen. The average delay for flights in 2015 was 21 minutes – two minutes longer than in 2014, the Civil Aviation Administration of China (CAAC) said in a report on its website, dated May 30. Air traffic control issues were the biggest reason for the delays, followed by bad weather, the CAAC said. Air China, China Eastern Airline and other carriers are expanding their fleets and budget carriers have emerged as economic growth spurs travel demand in China, where the military dominates the country’s air space.<br/>Shenzhen Airport was ranked the worse performing, in terms of flight delays, out of 49 Chinese airports tracked by website Flightstats in 2015. About 436.2 million people travelled by air last year – 11.3% more than a year earlier, according to the report. Chinese airports fare poorly in timely airport departures, according to April data on the website of Flightstats. Of the 49 airports it tracked, Shenzhen was ranked bottom, Guangzhou second-to-bottom, Shanghai’s two airports 45th and 46th, and Beijing 40th. Hong Kong was placed 43.<br/>
Iranian airlines could purchase Boeing passenger jets in euros rather than the industry-preferred dollar if the United States’ financial system does not open up to Iran, a Boeing executive suggested Thursday. Boeing has been talking with “more than” two Iranian carriers, including flag airline Iran Air but not the Revolutionary Guard-owned Mahan Air, since February after the US government granted limited approval. Boeing has spoken with Iranian airlines about all of its models currently in production, Marty Bentrott, Boeing’s vice-president for Middle East sales, told reporters in Dublin on Thursday. “There is some very positive interest,” he said. Boeing was pipped by European rival Airbus who signed a preliminary agreement in January to sell Iran 118 aircraft valued at $27b. “There is plenty of opportunity still for Boeing,” Bentrott said. The approval allows Boeing to advise certain Iranian carriers of the technical capabilities of its aircraft, discuss the airline’s fleeting requirements and finalise general terms and conditions necessary to complete a transaction including on pricing. But the plane maker will have to apply to the US Treasury for a second license if it wants to complete any sale in what is seen as one of the last major untapped markets for new jets. Bentrott declined to say when Boeing could apply for the sale licence. “We just have to make sure we follow all the appropriate guidelines,” he said. <br/>
Boeing just set a new production record for its 787 Dreamliner. But the US planemaker is keeping mum, for now, on plans to speed output to an even faster pace as demand for wide-body aircraft shows signs of waning. The US planemaker has yet to decide when to boost the production rate to 14 Dreamliners a month, even with the popular carbon-fiber aircraft sold out through the end of the decade, CEO Dennis Muilenburg said Thursday at the Bernstein Strategic Decisions Conference in New York. That call depends on several pending sales campaigns for the plane, he said. Boeing has been planning the next step up in 787 output for several years as Airbus Group SE prepares its own production increase for wide-body aircraft. Faster deliveries of Boeing’s largest and most profitable Dreamliner models would help the company absorb some of the $29b in deferred production costs accumulated during the aircraft’s troubled start. “Fourteen-a-month is still where we’re heading,” Muilenburg said. “And we haven’t precisely defined the timing on that yet because it’s dependent on” the skyline, an aerospace term for planned monthly deliveries.<br/>