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This week BTE reports on; a drop in profits at three airlines including Air France KLMKoninklijke Luchtvaart Maatschappij (Royal Aviation Company) the flag carrier of the Netherlands and a good example of how acronyms can aid simple discourse., Iberia and SWISS, also Malev's decision to stop its long haul services and a further slow down in the demand for air services.

This has neither been good for European airlines nor the aviation industry generally, however it cannot honestly be said that it has come as any surprise either.
After BA's 88% slump in profits, the far smaller fall in earnings at Air France KLM, Iberia and SWISS can almost be presented as good news. It is not of course. The brief flirtation with solid profitability which airlines enjoyed in 2007 and at the beginning of this year is now melting away. Losses beckon for 2009 if the oil price continues to rise or even stay at its current level and demand continues to drop. 

It has long been predicted that the swingeing measures taken by US carriers to ride out the storm would arrive sooner or later over here. Malev's decision to stop its long haul services later this year is proof that this is now beginning to happen on a larger scale than so far seen in Europe.
But there are two grounds for at least a measure of hope. First, oil prices seem for the moment at least to have stabilised although there is no saying how long this will last.

Secondly Willie Walsh, ceo of BA, is talking of forming a super carrier by combining eventually his airline with American Airlines, Iberia and Cathay Pacific. Whether this would ever be allowed by the regulatory authorities is difficult to assess but it is the type of bold move which will give aviation a fillip.
Mr Walsh considers that any such merger would take 10 years. But there are increasing indications that the industry may not be able to wait that long.

Stanley Slaughter
EditorSomeone nominally in charge
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