IATA DATA SHOWS PAX GROWTH SLOWING IN MARCH; BUT CARGO DEMAND CONTINUES TO EXPAND

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By TESTCustomwebLP TESTCustomwebLP May 4, 2011 08:41

IATA DATA SHOWS PAX GROWTH SLOWING IN MARCH; BUT CARGO DEMAND CONTINUES TO EXPAND

The International Air Transport Association (IATA) scheduled international traffic results for March 2011 showing that year-on-year growth in passenger demand had slowed to 3.8% from the 5.8% recorded in February. Conversely, year-on-year growth in freight markets rebounded to 3.7% in March from the 1.8% recorded in February.

Compared to February, global passenger demand fell by 0.3% in March, while cargo demand expanded by 4.5%.

“The profile of the recovery in air transport sharply decelerated in March. The global industry lost 2 percentage points of demand as a result of the earthquake and tsunami in Japan and the political unrest in the Middle East and North Africa (MENA),” said Giovanni Bisignani, IATA’s Director General and CEO.

The impact of the events in Japan on global international traffic was a 1% loss of traffic in March. Looked at regionally, Asia-Pacific carriers saw a traffic loss of over 2%, North American carriers had a 1% drop and Europe’s carriers a 0.5% fall. Japan’s domestic market was the most severely impacted with a 22% fall in demand.

The disruptions in Middle East and North Africa cut international travel by 0.9 percentage points. Egypt and Tunisia experienced traffic levels 10-25% below normal for March. Military action in Libya virtually stopped civil aviation to, from and within that country.

Capacity adjustments lagged behind the sudden drop in demand. Against global demand growth of 3.8%, capacity expanded by 8.6%. The average load factor fell by 3.5 percentage points to 74.6%.

From the second half of 2010 until January 2011, international air freight expanded in tandem with the growth in world trade at an annualized rate of about 10%. This was dented in February 2011 when growth, for a number of factors, fell to 1.8% over the same month in the previous year. The 3.7% year-on-year increase in March reflects more normal trading conditions (outside of Japan and MENA) during the month.

IATA expects the second quarter of the year to show continued depressed air travel markets due to the events in Japan and MENA but such strong economic demand elsewhere will “support recovery in both passenger and cargo markets in the second half of 2011”.

“The big uncertainty is the price of oil. Even in the $120 a barrel range, it appears that strong economic growth in markets outside of Europe is continuing. We see this in the strong demand from business for premium travel which maintained 7.7% growth through February. But many leisure travellers are putting off flying because of the impact of high oil prices. The fragility of the situation is demonstrated by the considerably weaker 3.3% year-on-year growth in economy class travel in February. And, despite efficiency gains, the industry’s 1.4% profit margin leaves it vulnerable in the face of volatile markets,” said Bisignani.

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By TESTCustomwebLP TESTCustomwebLP May 4, 2011 08:41
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