IATA: "We have too much capacity"

Times are hard for the world's airlines, amidst rising fuel prices and fears that economic downturn will keep bums off seats. Giovanni Bisignani, the head of the International Air Transport Association (IATA) has warned that over-confident airlines bought too many planes last year, and now have too much capacity.

Bisignani told the Guardian that the industry faced stagflation, with the oil price driving up costs while a weak global economy pushed down earnings. "We have too much capacity. Yields [average ticket price] are down and we need to consolidate."

Music to our ears Gio! If airlines can't even fill the planes they have, why should we create more capacity by expanding airports? Perhaps we should be closing terminals instead...