Airlines globally could lose $6.1 billion in 2008, on soaring oil prices and financial market dislocation, the head of the International Air Transport Association said, The Wall Street Journal reported Thursday (subscription required).

Giovanni Bisignani, managing director of the IATA, which represents 230 airlines, called the sector "a fragile industry in a crisis" and that it's "bracing for more situations of airlines collapsing," due to high fuel prices and lower revenue, The Journal reported. Further, the air travel slowdown, once thought to be contained to developed nations, has spread to global air travel's plum: Asia, he added.

Airline slowdown could hurt Boeing, Airbus

Stock analyst and frequent flier C. Leonard Bauer told BloggingStocks Thursday if the Asian hemisphere is slowing, to go along with sluggish revenue statistics in Europe and the United States, the slowdown "would have wide implications, not just for airlines, but for airplane manufacturers Boeing and Airbus."

"Further consolidation globally, was a given, particularly in nations like India, which had too many airlines even before the global economy slowed, but the concern now is that national carriers will postpone or cancel plane orders," Bauer said. "From a U.S. perspective, that could mean bad news for Boeing. And what's bad news for Boeing is bad news for the U.S economy. Airplane sales have been one of the U.S. economy's few bright spots." [Bauer added that he does not own shares in or have a rating on any airline or airplane manufacturer. However, Bauer does have frequent flier miles/points in American Airlines (NYSE: AMR).]

These are tough economic times for the nation, most would agree, and one hard-hit sector has been the airline sector, specifically the major carriers.

Surging fuel costs, the increased precautions and reviews required for the post-September 11 era, and intensifying competition for international routes has led to large losses among many major carriers - - a condition that has forced them to raise fares and implement other cost-cutting changes.

Most have also instituted a baggage fee for a passenger's second bag, with some carriers charging for all bags. Still, for the most part travelers have taken the baggage fees in stride. Although viewed as a nuisance by many travelers, the reality is a second bag, in particular, is optional weight that increases flying costs per mile. And with aviation fuel zooming past latte-price levels, that's no significant expense.

Still, US Airways Inc. may have gone one too far with the fee system. Effective today, US Airways will start charging for water on flights by coach passengers, The Wall Street Journal reported Friday (subscription required). Bottled water will be $2. Passengers flying first class are exempt from the extra fee.