Etihad forecasts 15% passenger increase

Etihad Airways expects to grow passenger traffic by 15 per cent this year to seven million as it continues to add new aircraft and fly new routes amid one of the most difficult environments for long-haul airlines. New seating capacity will rise faster than passenger growth this year, however, putting added pressure on the airline's target of reaching profitability in 2010. James Hogan, the chief executive of Etihad, said he remained optimistic about the carrier's prospects this year even as he saw challenges in some of Etihad's key markets such as Europe and India.

"In the first quarter we saw demand holding, especially in premium (first and business class)," he said during a press conference highlighting the carrier's launch of direct non-stop flights to Melbourne beginning March 29. Like most airlines in the region, Etihad has offered a series of promotions this year to stimulate demand as airlines suffer from the fallout of the global financial crisis. It expects to earn US$3.1 billion (Dh11.38bn) in revenues this year, a 22 per cent increase from last year.

"It is getting tough in Europe, there is huge pressure on yield, and our Indian competitors are pushing to maintain (market) share," said Mr Hogan. igale@thenational.ae