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Report: 2010 Another Tough Year for Airlines


The International Air Transport Association says next year's losses will narrow to $5.6 billion for the industry around the world.

Airlines face another year of severe losses in 2010, although the losses are not expected to be quite as bad as in 2009.

The International Air Transport Association says next year's losses will narrow to $5.6 billion for the industry around the world. While that is a staggering loss for the airlines, it is an improvement over 2009, which saw $11 billion in red ink.

An IATA report Tuesday says industry revenue and passenger demand will rise next year. But the study also says those gains will not be enough to overcome rising fuel costs and low fares.

Air fares are down because the industry still has more capacity than it needs to meet demand, forcing companies to offer lower prices to attract the remaining passengers.

Some information for this report was provided by AP, AFP and Bloomberg.

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