IATA has released international traffic data for
April 2009 that shows a 3.1% decline in passenger demand and a
mammoth 21.7% fall in cargo demand compared to April 2008. The
average passenger load factor for the month stood at 74.4%.
While April’s 3.1% passenger demand drop was a clear
improvement compared to the -11.1% fall in March, this improvement
should be viewed with caution. Easter holidays, which fell in the
month of April, positively skews the data by at least 2%. Traffic
gains were at the expense of yields in most regions. And
preliminary data for May suggests a renewed double digit decline,
at least for European airlines.
Freight demand appears to
have found a solid floor with a fifth consecutive month at more
than 20% below previous year levels.
“We are not out of the
woods yet,” said Giovanni Bisignani, IATA’s Director General and
CEO. “The demand improvements that we saw in April are welcome.
But the 3.1% decline in passenger demand still outstripped the
2.5% cutback in capacity. There is no improvement in revenues as
yields continue to fall. And freight remains at shockingly low
levels. The worst may be over. However, we have not yet seen any
signs that recovery is imminent.”
International Passenger Demand
demand declined by 3.1% in April.
Load factors improved to
74.4% in April (compared to 72.1% in March); however this is
slightly distorted by high volume holiday travel. Forward
schedules show a return to previous-year capacity levels by the
end of the third quarter. Without a corresponding sharp
improvement in demand, load factors are likely to decline rather
Asia Pacific carriers continued to see the most
significant demand deterioration. Their 8.6% fall outstripped
capacity adjustments of -7.4%.
An acceleration of fare
discounting saw demand increase on North Atlantic routes. North
American carriers, who experienced a 13.4% drop in demand in
March, saw this reduced to -4.2% in April. The capacity adjustment
of -4% much more closely matched the fall in demand than in
March when there was a 7.7 gap of points.
carriers, the 11.6% decline in passenger demand reported for March
improved to -2.7% in April, closely matching the capacity
adjustment of -2.6%.
Middle Eastern carriers saw demand growth
in April of 11.2%, against a capacity expansion of 12.3%.
Latin American carriers saw demand expand by 7.5%, outstripping a
capacity increase of 6%. Nonetheless, Latin American carriers
recorded the weakest load factor, 71.2%.
experienced a 7.1% fall in demand, outpacing the capacity cut of
International Cargo Demand
International cargo was down 21.7% in April
compared to previous year levels. This is the fifth consecutive
month in the -20% range. This sideways progression may indicate
that the industry has seen the worst of the economic downturn.
confidence is improving, but inventories remain high. Until
inventories adjust to more normal levels, air freight volumes will
likely continue to bounce along the bottom.
Carriers in all
regions showed double digit declines. Middle Eastern carriers were
the strongest performers at -11.1%. European, North American,
Asia Pacific and African carriers had similar performance of
-23.3%, -22.4%, -22.3% and –18.8% respectively. Latin American
carriers were the worst performers at -24.2%.
“With each day of
the recession, the challenges for the air transport industry are
mounting. Flexibility has never been more important. But there is
not enough of it. Airlines remain constrained by old rules that
restrict basic commercial freedoms such as access to markets and
capital. Much of the cost base remains out of our control - from
volatile fuel prices to monopoly infrastructure charges. And many
governments simply don’t understand the need for urgent change. We
need a change in mindset. To manage through this ongoing crisis,
every player in the air transport value chain must be prepared to
drive change,” said Bisignani.
The 65th IATA Annual General
Meeting and World Air Transport Summit will take place in Kuala
Lumpur, Malaysia next month from 7-9 June.
On the agenda of the 600
industry leaders expected to attend will be the
industry’s top priorities, including safety,
environment, infrastructure charges, taxation and
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