Geneva, 2012-08-30 — /travelprnews.com/ — The International Air Transport Association (IATA) announced global traffic results for July showing slower growth in both air travel and freight, but with considerable variation by region and market.
Airlines have responded to this slower growth environment by reducing the capacity added to markets, a move which has stabilized load factors at relatively high levels and provided some support for profitability in the face of high fuel prices. In July passenger capacity rose 3.6%, in line with the expansion of traffic, keeping the load factor at a relatively high 83.1%.
“The uncertain economic outlook is having a negative impact on demand for air transport,” said Tony Tyler, IATA’s Director General and CEO. “The cargo business is 3.2% smaller than it was a year ago. And passenger markets—with the exception of Africa, China-domestic and the Middle East—saw demand fall from June to July. Overall passenger demand is still up 3.4% on the previous July. But the growth trend is clearly slowing. This, along with rising fuel prices is likely to make it a tough second half of the year.”
July 2012 vs. July 2011 | RPK Growth | ASK Growth | PLF | FTK Growth | AFTK Growth |
---|---|---|---|---|---|
International | 3.5% | 3.5% | 83.3 | -3.3% | -0.1% |
Domestic | 3.1% | 3.8% | 82.6 | -2.4% | -2.2% |
Total Market | 3.4% | 3.6% | 83.1 | -3.2% | -0.6% |
YTD 2012 vs. YTD 2011 | RPK Growth | ASK Growth | PLF | FTK Growth | AFTK Growth |
---|---|---|---|---|---|
International | 6.8% | 4.7% | 78.7 | -2.8% | 1.6% |
Domestic | 4.5% | 4.1% | 79.4 | 0.6% | -1.1% |
Total Market | 6.0% | 4.5% | 78.9 | -2.4% | 1.0% |
International Passenger Markets
July international passenger demand was up 3.5% compared to the year-ago period, exactly in line with a 3.5% expansion in capacity. Load factors stood at 83.3%. The slowdown becomes evident when comparing to the previous month (June) when the year-on-year rate was 7.5%. Growth on average during the first half of the year was also 7.5%. The slowdown in international air travel growth has been concentrated in the past few months, in line with the decline of business confidence. Weakness in some key domestic air travel markets has been evident for rather longer period. Only African and Middle Eastern carriers showed month-to-month growth. Carriers in all other regions reported aggregate declines for international demand for July compared to June.
Domestic Passenger Markets
Domestic markets also experienced slow growth, continuing the trend that began early this year. In total, traffic rose 3.1% year-on year, down from 4.2% in June. However, the slowdown was not universal, with China and Brazil recording strong growth that was offset by weakness in India and Japan.
Air Freight (Domestic and International)
Air freight demand contracted 3.2% compared to July 2011 but was unchanged compared to June. Middle East carriers recorded a 16% increase in demand year-on-year but all other markets experienced declines and the small recovery seen since the end of 2011 has stagnated.
The Bottom Line
“The huge success of the London Olympics was also an important reminder of the vital role that international aviation plays in bringing the world together and facilitating global mega-events. Now all eyes are on Brazil which will host the 2014 World Cup and the 2016 Olympics. And aviation will play a key role there as well,” said Tyler.
“It will take a team effort to ensure that Brazil’s aviation infrastructure is up for the challenge,” said Tyler. Brazilian aviation supports 940,000 jobs and 1.3% of GDP, while the connectivity provided by aviation supports Brazil’s emergence as a rising BRICS economy. But, despite aviation’s economic importance to Brazil, the country ranks 93rd for the quality of its air transport infrastructure in the World Economic Forum’s Travel and Tourism Competitiveness Index.
Last week IATA, working in partnership with the Latin American and Caribbean Air Transport Association and other aviation organizations, hosted the first Aviation Day in Brazil. “With a focus on global standards, industry and government looked at ways to cooperate to ensure that Brazilian aviation continues to be a key driver of growth, operating at ever higher levels of safety, security, efficiency and sustainability,” said Tyler. “What is true for Brazil is also true for the rest of the world. Aviation supports 56.6 million jobs and has a global economic impact of $2.2 trillion. Governments should treat this resource wisely, with tax regimes that do not kill growth, regulation that facilitates growth and world-class infrastructure that can efficiently accommodate growth.”
View full July traffic results
For more information, please contact:
Corporate Communications
Tel: +41 22 770 2967
Email: corpcomms@iata.org
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