--Slight Slowing from
May--
6 August 2014 (Geneva) - The International Air Transport
Association (IATA) announced global passenger traffic results for June showing
a modest deceleration in demand growth compared to the prior month. Total
revenue passenger kilometers (RPKs) rose 4.7% over the year-ago period, which
was below the 6.2% year-on-year increase recorded in May 2014. June capacity (available
seat kilometers or ASKs) increased by 5.0%, causing load factor to slip 0.2
percentage points to 81.5%.
“June traffic
growth at 4.7% is encouraging even though it is a slight weakening on May’s
performance. Earlier signs of a softening in demand are dissipating. While
that’s good news there are many risks in the political and economic environment
that need careful monitoring,” said Tony Tyler, IATA’s Director General and
CEO.
International Passenger Markets
June international
passenger demand rose 5.5% compared to the same month last year, with airlines
in all regions except Africa recording growth and the strongest gains among Middle
East carriers. Capacity climbed 5.7% and load factor dipped 0.2 percentage
points to 81.4%.
·
European carriers saw demand increase 5.6% in June
versus June 2013. This is consistent with steady and continued economic
recovery for the region. Capacity rose 5.3% and load factor climbed 0.3
percentage points to 83.8%.
·
Asia-Pacific carriers’ traffic rose 4.9% compared to the
year-ago period but capacity rose 6.7% and load factor slipped 1.3 percentage
points to 77.9%. The outlook for this region looks broadly positive, with
measures of manufacturing activity and export orders pointing to better
performance of China.
·
North American airlines experienced a 3.1% rise in traffic compared
to June a year ago. Capacity rose 5.9%, however, which caused load factor to
fall 2.2 percentage points to 85.1%, which still was the highest among the
regions. Recent data from the US suggest that underlying growth trends in
business activity are positive and the unemployment rate is showing
improvement.
·
Middle East carriers’ demand jumped 10.8% in June, the largest
increase for any region and reflecting the continued strength of regional
economies and solid growth in business-related premium travel. Capacity climbed
just 5.9%, propelling load factor up 3.7 percentage points to 82.1%.
·
Latin American airlines’ traffic rose 7.1% compared
to June 2013. Capacity rose 6.6%
and load factor climbed 0.4 percentage points to 79.5%. While growth was solid, it was below the 8.1% annual result for 2013.
Part of the softness is owing to a significant reduction in capacity this year
compared to last as well as sluggishness in major economies and consequently,
regional trade growth.
·
African airlines saw a 2.7%
reduction in demand in June, while capacity climbed 2.0%, resulting in a 3.3
percentage point drop in load factor to 67.3%, the lowest load factor for any
region. The weakness could be attributable to adverse economic developments in
some parts of the continent, including the slowdown of the major economy of
South Africa.
Domestic
Passenger Markets
Domestic travel demand rose 3.4% in June
compared to June 2013, with the strongest growth occurring in Russia and China.
Total domestic capacity was up 3.8%, and load factor slid 0.3 percentage points
to 81.7%.
|
Year-on-Year Comparison
|
June 2014 vs June 2013
|
YTD 2014 vs. YTD 2013
|
||||
|
|
RPK
|
ASK
|
PLF
|
RPK
|
ASK
|
PLF
|
|
Australia
|
2.4%
|
3.7%
|
76.0%
|
3.1%
|
3.6%
|
74.9%
|
|
Brazil
|
0.2%
|
-2.5%
|
79.4%
|
7.3%
|
0.9%
|
79.5%
|
|
China P.R.
|
6.6%
|
9.7%
|
79.2%
|
10.8%
|
11.2%
|
80.6%
|
|
India
|
4.2%
|
7.1%
|
73.1%
|
2.0%
|
7.1%
|
73.7%
|
|
Japan
|
4.1%
|
-2.8%
|
63.4%
|
5.3%
|
1.8%
|
63.8%
|
|
Russian Federation
|
12.0%
|
10.2%
|
80.1%
|
11.6%
|
10.5%
|
72.7%
|
|
US
|
2.0%
|
2.1%
|
87.0%
|
2.1%
|
0.9%
|
84.7%
|
|
Domestic
|
3.4%
|
3.8%
|
81.7%
|
5.1%
|
4.3%
|
80.3%
|
·
Russian domestic demand
rose 12% in line with government economic policies that support expansion in
domestic air travel.
·
Brazil domestic demand,
by contrast, experienced virtually zero demand growth in June compared to
June 2013, despite being the host of the FIFA World Cup. Conditions in the
Brazilian economy have done little to boost growth in air travel this year,
with inflation continuing to rise and consumer confidence on the wane.
The
Bottom Line:
“Demand for
air travel and the connectivity it provides remains strong. But uncertainty in
the global political and economic climate has the potential to negatively
impact demand. Risk is today’s reality, whether it’s conflict in the Middle
East, sanctions and an impending trade war with Russia, possible default in
Argentina or the Ebola outbreak in Western Africa. All have the potential to
dent demand. We are optimistic that the industry will still end the year with
an improvement in profitability over 2013. But the regional impact of some of
these risks will challenge some airlines more than others,” said Tyler.
“One of the
biggest regional challenges could be Ebola. Travelers should be reassured that
airlines are coordinating closely with the World Health Organization (WHO) and
the International Civil Aviation Organization (ICAO). WHO currently advises
that the risk to travelers is low and is not recommending travel restrictions
or border closings. If, however, a passenger feels unwell it is always advised
that they seek the advice of a doctor before traveling,” said Tyler.
“The aviation
community has worked with WHO and ICAO in several challenging public health
situations during recent years. As a result, guidance and procedures have been
developed to keep travel safe. These include procedures for front line staff to
detect those potentially infected and handle them appropriately. IATA continues
to work with WHO and ICAO to ensure that airlines are well-prepared to deal
with the situation however it unfolds,” said Tyler.
