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Airline Traffic SlowsMay 29, 2008 By: George Dooley
“Combine slowing growth with skyrocketing oil prices and the [airline] industry outlook is grim at best,” said Giovanni Bisignani, director general and CEO of the International Air Transport Association (IATA), as 700 plus airline executives gathered for IATA’s Annual General Meeting being held in Istanbul, June 1-3.
“In 2007 airlines posted a profit of US$5.6 billion," said Bisignani. "This was the first profit after six years in which losses totaled more than US$40 billion. To achieve this, we re-engineered the industry.
“On June 1, the industry will mark a Simplifying the Business milestone, having achieved 100% e-ticketing. It means $3 billion in cost savings and greater convenience everywhere. But there will barely be time to celebrate. Much more change is needed.”
IATA also released international airline traffic data for April.
Year-on-year international passenger demand grew by 3 percent in April. Capacity growth of 5 percent saw load factors fall to 75.4 percent. This is a 1.5-percent drop from the 76.9 percent recorded during the same period last year and the third consecutive monthly year-on-year decline.
April figures contain several distortions, IATA noted. This includes a 10 precent transatlantic capacity increase with the commencement of the US-EU Open Skies is estimated to have boosted global traffic by about 1 percent. Adjusting for these distortions and leap year, underlying passenger traffic demand increased 4 percent in April and the three previous months.
“The impact of skyrocketing oil prices and weaker economies has made its way to traffic growth," said Bisignani. "At this time last year we were talking about 6.7 percent growth for the first four months of the year. This year it’s 4 percent. There has been a step change downwards.”