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International Air Transport Association

Those economic justifications, from American Airlines, Delta Air Lines, Federal Express and United Airlines, included forecasts of freight revenue and earnings under existing rates, for the two years ending February 28, 2002 for each of the operating divisions (Atlantic, Pacific and Latin America). Although these forecasts were prepared as justification for an earlier IATA agreement, they remain relevant for evaluating the agreement before us now. The rate increase proposed in the agreement involves only the Atlantic area. As detailed in the Attachment, all of the U.S. carriers project operating losses and negative returns on investment in their Atlantic freight operations under existing rate levels. The proposed rate increases affect very little traffic to/from the U.S. and will have a de minimus effect on U.S. carrier earnings.

By:  Susan McDermott

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