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January Air Demand Shows ImprovementMarch 2, 2010 By: George Dooley
The International Air Transport Association (IATA) reports that January 2010 demand statistics for international scheduled air traffic showed continuing improvement. Compared to the previous year, January passenger demand was up 6.4 percent. Against this improving demand, a 1.2 percent increase in passenger capacity in January pushed load factors to 75.9 percent (up from the 72.2 percent recorded for January 2009).
The large increases in year-on-year comparisons reflect a steady improvement from the precipitous fall in demand that characterized the early part of 2009 rather than a dramatic improvement in January, IATA said. Compared to December 2009, and adjusting for seasonal variations, passenger demand grew by 0.5 percent while air freight volumes increased by 3.0 percent.
“Airlines have lost two-three years of growth. Demand is moving in the right direction. The 3.0 percent increase in freight volumes from December to January is particularly encouraging. We can start to see the future with some cautious optimism, but better volumes do not necessarily mean better profits. Passenger yields are still 15 percent below peak. And we expect 2010 losses to be US$5.6 billion,” said Giovanni Bisignani, IATA’s Director General and CEO.
There are large geographical differences in the improvements. The strongest upturns have been seen in markets where economic recovery from the recession has been strongest—Asia, Latin America and the Middle East. Compared to the low point in the cycle (February 2009) international passenger traffic is up 8.6 percent, IATA said, but the market has not yet recovered from the losses of 2008 and early 2009. Demand must improve by a further 2 percent to return to the peak levels of early 2008.
Carriers in North America and Europe saw demand increase by 2.1 percent and 3.1 percent respectively. Although both regions have gained 6 percent from the early 2009 lows, they remain 4-6 percent below the early 2008 peak levels. This reflects the jobless recovery from the recession in which consumers are focused on paying down debt.