Lufthansa gives gloomy outlook

Deutsche Lufthansa provided a gloomy outlook for the airline industry on Thursday, saying the market environment remained very difficult.

"Initial signs of a stabilisation in volumes are far away from making up for the enormous and unrelenting pressure stemming from the massive fall in price levels," the company said in its quarterly financial report.

It also said it was still too early to give the all-clear for the air cargo industry. Drops in volumes were not as severe as in prior quarters, but revenue was still falling steeply due to a drop in prices over recent months.

The German flagship carrier had sounded a warning on Wednesday that it could miss its target of making an operating profit in 2009, blaming stubbornly low demand and a fresh rise in oil prices.

Industry body IATA said last month that the aviation sector was still far from returning to profit, although demand had started recovering from a steep slump. It has said it sees the world's airlines losing $11 billion this year.

Lufthansa has been battling rivals Air France-KLM and British Airways for pole position in the European aviation sector and last year agreed to a raft of acquisitions to grab market share in the region.

It added airlines including Brussels Airlines, Austrian Airlines and British carrier bmi to its family, which already contained Swiss and Germanwings. It has yet to decide whether to keep bmi in the long run.

British Airways is scheduled to publish its quarterly results on November 6 and Air France on November 18.