Thursday 29 June 2017

Air industry flying high with a 12pc increase in passengers

Jonathan Lynn

International air-passenger traffic in June soared 12pc from the same month a year ago as the aviation industry continued to recover much faster than expected.

"The question is, how long can the industry maintain the double-digit momentum," said International Air Transport Association (IATA) Director General Giovanni Bisignani.

"Business confidence remains high and there is no indication that the recovery will stall any time soon," he said.

"But with government stimulus packages tailing off and restocking largely completed, we do expect some slowing in the months ahead."

IATA, which represents some 230 airlines world-wide, comprising 93pc of scheduled international air traffic, said in its monthly report yesterday that sharp regional differences were evident in the recovery. The rate of recovery in Europe was half that of the Asia-Pacific region. Outside of Europe, all regions reported double-digit growth in passenger traffic.

Mr Bisignani said a clear indication of the growing confidence was the placement of orders for more than 400 aircraft announced last week at the biannual Farnborough International Air Show in the UK.

"This is good news that will bring environmental benefits through improved fuel efficiency," he said. "But it will also make the challenge of matching capacity to demand much more difficult."

Fastest

International passenger demand in Europe last month grew only 7.8pc annually, while demand for Asia-Pacific carriers rose by 16pc, driven by growth in the Chinese market.

Middle Eastern carriers continue to post the fastest growth, up 18pc. This is based on a strong regional economy and the ability to attract long-haul traffic through the region's hubs, IATA said. Africa carriers reported a 21pc jump in traffic, boosted by activities surrounding the football World Cup in South Africa.

Traffic in Latin America increased 15pc while demand in North America rose 11pc, resulting in an industry-leading load factor of 86.6pc, which is contributing to strong second-quarter financial results for carriers in the region.

Load factors, which measure the proportion of seats airlines fill with paying passengers, last month remained at historical highs of 79.8pc as capacity only slightly outpaced improvement in demand.

International freight traffic last month jumped 27pc annually, down from 34pc in May but 6pc above the pre-recession peak in early 2008.

Demand continues to follow economic recovery and trade patterns, IATA said, with the Asia-Pacific region, the Middle East, Latin America and Africa growing quickest, while North America occupies the middle ground.

In a reflection of trends in passenger traffic, Europe is growing at half the rate of the fastest-growing regions, but IATA said the weaker value of the euro would help the European exporters eventually to increase cargo volumes.

Irish Independent

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