Bloomberg News

Qatar Airways Expects Strong Recession to Cut Travel Demand

February 13, 2012

(Updates with comments on A380 in sixth paragraph. Click SHOW <GO> for more on the Singapore air show.)

Feb. 13 (Bloomberg) -- Qatar Airways Ltd. Chief Executive Officer Akbar Al Baker said he expects a “strong recession” that will sap global air-travel demand.

“We will be affected by at least 5 percentage points in loss of passenger numbers,” Al Baker said today in a Bloomberg Television interview in Singapore. “As in any other recession, all classes will be affected.”

A European sovereign debt crisis is sapping global economic growth, contributing to China’s exports falling for the first time in two years in January and causing Japan’s economy to contract in the fourth quarter of last year. The slowdown has already hit airlines, causing Spanish carrier Spanair SA and Hungary’s Malev Zrt. to halt operations.

“There will be a strong recession,” Al Baker said. “There’s some stability in Asia, but going forward we believe we will be affected like any other airline.”

Al Baker also he said expected Airbus SAS would resolve an issue with Airbus SAS A380 planes that has caused wing-rib feet to crack. Fissures have been found in planes used by Singapore Airlines Ltd. and Qantas Airways Ltd.

“It’s a relatively new aircraft and like any new machines it will have problems,” Al Baker said. “I’m sure Airbus will overcome this.”

Qatar has ordered 10 A380s. Airbus is yet to begin building the aircraft, Al Baker said.

--With assistance from Anand Menon in Singapore and Karolina Miziolek in Hong Kong. Editors: Neil Denslow, Frank Longid

To contact the reporters on this story: Kyunghee Park in Singapore at kpark3@bloomberg.net; kpark3@bloomberg.net; Haslinda Amin in Singapore at To contact the editor responsible for this story: Neil Denslow at ndenslow@bloomberg.net


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