Airline Recovery Begins (Blackout Notwithstanding)

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As in just about everything else, timing is everything in financial forecasting. Just two days before a blackout paralyzed a good part of the North American airline industry, the International Civil Aviation Organization (ICAO) was giving a rosy outlook for the coming two years. It's too early to tell what effect the millions in losses from Thursday's blackout will have on the incipient recovery but if ICAO is right it might be just a minor blip in an otherwise upward trend, worldwide. The Montreal-based group says passenger traffic will rebound by 4.4 percent in 2004 and a healthy 6.3 percent the following year. That will more than wipe out the net 2.5 percent overall reduction in traffic since 9/11. North American carriers will be the slowest to recover, however. They won't hit 2000 passenger figures until 2004. Asian markets, hardest hit by the SARS outbreak, will also take time to recover but by 2005 growth should be about 6.9 percent. Long-term forecasts suggest the growth rate will stabilize at about 4 percent, slightly less than was predicted before 9/11.