Being profitable is not something airlines should have to apologise for, the chief of IATA said at an aviation conference Feb 25. IATA CE and DG Tony Tyler said the airline industry was changing—and becoming more sustainably profitable—because of “a lot of hard work and the confluence of some key factors.” “We expect that airlines will deliver a US$36b profit in 2016, for a 5.1% net margin. While it’s not close to the 23% net margin that Apple delivered last year, it is considered a strong result for our industry. Even more significantly, airlines are starting to provide a normal return to their investors,” Tyler said. Tyler noted that North America is leading the industry in terms of profitability, with US and Canadian airlines expected to earn some $19.2b in 2016, or roughly half the industry’s global profit. <br/>
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A number of airlines have raised concerns that the rapidly spreading Zika virus maybe discouraging travel in the Americas, IATA's DG Tony Tyler said. His comment marks one of the industry's first acknowledgments that the mosquito-borne virus could hit revenue. "A number of members have expressed concern that they may already be seeing some effect on travel, particularly in the Americas," he said. "When we publish numbers, particularly I think the regional numbers for January, perhaps there will be the first indication of that." Tyler could not comment on what kind of impact the airlines were seeing, whether destination switches or lower bookings overall. Airlines so far have reported no material change to flight bookings because of the virus, and they note that identifying a shift would be difficult. <br/>
Ottawa should raise current foreign-ownership limits on airlines to boost competition and encourage new entrants into the market, a study for the Canadian govt has recommended. The review, which sought to identify priorities for updating Canadian transport laws, recommended the govt increase foreign ownership limits to at least 49% from 25% for air carriers providing commercial passenger services. "Our goal is to see Canada join most other large aviation markets in allowing significant (but not full) foreign ownership of passenger air carriers," the report said. "These changes should contribute to narrowing the gap between Canada and other markets in terms of our relatively low level of competition and our relatively high air fares." <br/>
Russia warned that more airline companies could go bankrupt like Transaero, the nation's second-largest carrier that was forced out of business in October. "Airlines are accumulating losses, and we do not rule out the risk of airlines going bankrupt if demand does not pick up and traffic does not grow as a result," deputy transportation minister Valery Okulov told lawmakers Feb 25. Rosaviation, the Russian air transport agency, reported that overall passenger traffic in January fell by 6% to 5.54m from a year ago. Of the total, it said international passenger traffic plunged by 26% to just over 2m, while the number of passengers on domestic routes rose by 11% to 3.5m. The figures show the dramatic effect of Russia's economic crisis on air travel and foreign vacations. <br/>
South Korea and Serbia have signed an agreement to help increase flights between the countries, the Foreign Ministry said Thursday. The accord was signed by South Korean ambassador to Belgrade Lee Do-hoon and Serbian deputy prime minister Zorana Mihajlovic Wednesday. The two sides initialled an agreement in 2014 to operate 3 flights per week and allow code-sharing between airlines. "Although no direct flights are currently in service between South Korea and Serbia, once the agreement takes effect, we expect passengers to more easily book flights and carry out relevant procedures through code-sharing and other means," the ministry said. "We expect the agreement to provide a good opportunity for our airlines to expand into the Eastern European aviation market," the ministry said. <br/>