Sir Richard Branson, chairman of the Virgin Group, has warned that there will be some “spectacular casualties” in the airline industry over the coming year.
Alluding to burgeoning fuel costs and the deepening impact of the global credit crunch, the business magnate said several economic factors were combining to create a “perfect storm”.
That terminology echoed verbatim a recent assessment by Giovanni Bisignani, director of the International Air Transport Association, who last month declared that the industry is struggling for survival.
Speaking to The Times over the weekend, the owner of Britain’s second largest long-haul airline said that the difficulties were beginning to affect even the healthiest airlines.
“The financial state of the world is just about the worst I’ve ever known it,” Branson told the newspaper. “It’s getting perilously close to being worse than the 1990s.
“You have the perfect storm. You’ve not only got the banking crisis and the housing crisis, you’ve got the soaring fuel prices as well. One of the big American carriers will almost definitely go.”
His comments come as aircraft maker Airbus confirmed that it has compiled a watch list of airlines which it believes could fall into financial difficulties.
