Aviation ist the most challenging industry of our times.

In its latest forecast, the IATA has lowered its industry forecast for 2008 total net profits from $ 9.6 billion to $ 7.8 billion.

This $ 1.8 billion reduction is almost entirely because of the ultra high fuel costs.

Bus also the housing finance and mortage crisis in the United States led to the reduction and puts questions over the industry performance next year.

Jet fuel represents nearly 28% of the industry´s total operating cost. But with fuel prices rising, these costs will as well and will impact on the fiancial results of the IATA carriers, so that a reduction of the forecasted industry profits seems to be more than necessary even airlines have been able to pass on some of their higher costs to the passengers, this may be more difficult in an economic downturn.

While the outlook for next year has been reduced, the profit estimate for 2007 has been raised from $ 5.1 billion to $ 5.6 billion.

Interestingly enough Asia/Pacific Carriers have launched massive capacity additions by 42% since 2001. North American carriers added only 11% in capacity over the same time.

We also do follow Mr. Bisignanis call for more co-ordinated, concerted action on the environment, security and safety.

Goverments have the responsibility to provide a stable environment for industry growth. Failure to agree on a global way of emissions trading will certainly lead to legal battles between Europe and the rest of the world.

This is the last chance for goverments to get it right !

Sincerely

Nuri Sensert

Managing Director