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coshop
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Join Date: Apr 26th, 2011 |
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Location: Islamabad |
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Posts: 48 |
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According to the annual report of Pakistan International Airlines (PIA), air travel rose by seven percent in 2010. With the world economy growing at 3.1 percent during 2011, the air travel demand would increase in 2011, the report said.
Industry analysts said that the local aviation industry has always been prone to global geopolitical changes. The efforts and results are overshadowed by the global trends in aviation and the varied risks that airlines face, they said.
The performance of the aviation industry depends very much on how fast the national economy steers out of the current economic imbroglio, the report said.
However, the analysts are cautious that the industry might be affected by several external factors, including and not limited to the rising fuel oil prices, exchange and interest rate fluctuations, law and order situation in the country and also internal shortcomings, particularly in PIA.
According to the report, as the global economy gradually shifts gears and moves out of recession, the aviation industry has still not been able to fully recover from the crisis that engulfed it in the wake of the oil price hike and financial meltdown.
In fact, with the recent events in the Middle East unfolding, oil prices have again started to climb, which casts doubts on the ability of the aviation industry to return to profitability in the foreseeable future.
However, the record high load factors, which in the recent past, went as high as 78 percent, along with yields will be the key to determine the profitability of the airlines, keeping in view the high oil prices.
The report says that in the current economic scenario, it is expected that the demand for business travel and cargo will be more robust than the demand for price sensitive leisure travel because of economic pressures. —Javed Mirza
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