Air travel demand slackens

Growth in Europe remains sluggish
Demand for air travel is continuing to moderate after a strong start to the year, the International Air Transport Association said as it released its global passenger traffic results for May.
Demand measured in revenue passenger kilometres rose 4.6% compared to the same month in 2015, the same level achieved in April. Despite this, capacity climbed 5.5%, which pushed the average load factor down 0.7 percentage points to 78.7%.
“After a very strong start to the year, demand growth is slipping back toward more historic levels,” said Tony Tyler, IATA’s Director General and CEO. “A combination of factors are likely behind this more moderated pace of demand growth. These include continuing terrorist activity and the fragile state of the global economy. Neither bode well for travel demand. And the shocks of Istanbul and the economic fallout of the Brexit vote make it difficult to see an early uptick.”
Airlines in all regions recorded growth, but some more than others. European carriers’ demand climbed just 2.1% over May 2015, reflecting continuing fallout from the Brussels terror attack. Capacity rose 3.5% and load factor dipped 1.1 percentage points to 80.6%, which despite the decline is still the highest among the regions.
Asia-Pacific airlines’ traffic rose 5.1% and capacity increased 6.4%, which caused load factor to slide to 75.1%. Strong upward momentum has stalled in recent months with growth tracking sideways since the beginning of the year.
Middle East carriers had an 11.8% rise in demand in May, the biggest among the regions. But capacity rose 15.6% and load factor dropped 2.4 percentage points to 71.9%. There, growth in capacity has now exceeded traffic growth in 18 of the past 20 months.
North American airlines’ traffic climbed 0.5% as carriers focus on the larger and stronger domestic markets. Capacity rose 1.9% and load factor fell to 80.1%. Latin American airlines experienced a 5.1% rise in traffic but, as with Europe, upward momentum has stalled. Capacity climbed 5.2% and load factor was flat at 80.2%.
African airlines’ traffic rose 9.5%, continuing the trend of strong growth linked to the expansion of long-haul networks by the region’s carriers, particularly Ethiopian Airlines. Capacity rose 10.4% and load factor slipped to 64.5%.
Demand for domestic traffic rose 5.1%, outpacing international demand growth of 4.3%. But again results were mixed, with Brazil, Russia and Japan all showing declines, China, India and the US seeing rises.
Airlines International


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