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IATA: Passenger Traffic Shows Stronger Gains

October 26, 2010 By: Staff

International passenger traffic had a 10.5 percent year-on-year increase which is significantly stronger than the 6.5 percent rise recorded for August, the International Air Transport Association (IATA) reports in its announced international traffic results for September. International freight traffic recorded a 14.8 percent year-on-year increase, which is significantly weaker than the 19.0 percent rise recorded in August.

The contrast between the performance of freight and passenger markets provides a mixed picture for industry performance, IATA says. Seasonally adjusted figures show that, compared to the previous month (August), passenger traffic expanded by 2.1 percent while freight markets contracted by an equal 2.1 percent.

The rebound in growth in passenger markets during September can be attributed to normal volatility in travel patterns accentuated by special factors such as the effect of the Ramadan. Passenger capacity expanded by 7.3 percent, below the 10.5 percent growth in volumes, pushing global load factors up to 80 percent. This is a significant improvement on the 77.7 percent recorded for September last year.

While freight markets were expected to weaken towards year-end, September’s decline was larger than anticipated. Consumer and business confidence remains weak in many parts of the world, IATA said. Re-stocking lifted freight markets earlier in the year, but this has not been followed by spending to solidify the economic recovery.

“It is good news that the recovery in passenger markets continued in September. But the freight numbers are worrying. Freight activity has fallen 6 percent since May’s post-crisis peak. What we see in air cargo markets is inevitably reflected in the broader economy,” said Giovanni Bisignani, IATA’s Director General and CEO. As international air cargo accounts for 35 percent of the value of goods traded internationally, it is a leading indicator of economic activity.

North American carriers saw their traffic climb back to pre-recession (early 2008) levels during the month with an 11.1 percent increase in passenger demand compared to the previous September. This outstripped a 7.2 percent capacity expansion. The region recorded the strongest passenger load factors at 84.1 percent.

“The industry’s situation is volatile. Passenger traffic represents about three quarters of the industry’s revenues. While September’s passenger growth is reassuring, the accelerating decline of air freight, including in Asia, is an early indicator of some turbulence ahead,” said Bisignani.

“Government actions can impact the sustainability of the recovery. Austerity measures will dampen demand. When combined with new or increased taxation, as we have seen in Germany and the UK, the challenges are even greater,” said Bisignani.

“Governments must understand that air transport is an economic catalyst. Last year, we saw that a EUR312 million departure tax in the Netherlands cost the Dutch economy EUR1.2 billion. Further taxing the industry makes no sense when the focus of governments should be on making the recovery sustainable,” said Bisignani.


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By Staff | October 26, 2010
Solid gains in passenger traffic offset by decline in freight.
Filed under : airline policies