Paper tickets face the axe

8216;8216;In 2003, the industry survived the four horsemen of the apocalypse 8212; SARS, conflict in Iraq, terrorism and the economy. Now, a fifth horseman 8212; the price of oil 8212; could add up to 1 billion per month to our costs and deny us profitability yet again,8217;8217; IATA Director-General Giovanni Bisignani said.

Bisignani said if fuel averaged 36 a barrel this year the sector could expect 3 billion in losses, but a recovery to 33 a barrel would allow it to break even. Airlines have racked up more than 30 billion in losses in the past three years due to the impact of the September 11, 2001 attacks, SARS and the Iraq war. With global passenger traffic in the January to March quarter about 6.5 per cent above the levels of 2001, the industry was expected to post combined profits of 3 billion in 2004. But it now faces another year in the red due to soaring oil prices. Jet fuel is the second-biggest cost item for airlines, accounting for about 12 per cent to 20 per cent of total expenses.

Aside from eliminating paper tickets, Bisignani said the airlines agreed to work on an industry standard for check-in terminals worldwide, and he called on governments to shoulder more of the industry8217;s 5 billion annual security cost. 8216;8216;The figure for security is roughly 5 billion,8217;8217; he said. 8216;8216;Now the insurance market has returned to normal levels, but the security costs are increasing. So we really think this is an issue that has to be addressed by governments.8217;8217;

The airlines also plans to replace magnetic stripes with bar-codes on boarding passes so that they can be printed by passengers at home to cut costs and check-in times. The industry also agreed to use radio frequency technology, a baggage-tracking system, to replace bar-coded baggage tags.

8212;Reuters