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Demand For Air Travel Slows In November

by Ulrika Lomas, Tax-News.com, Brussels

16 January 2014


New statistics from the International Air Transport Association (IATA) show that the rapid recovery seen in recent months in air travel demand moderated in November. Annualized growth of 4.1 percent was witnessed in November, down from 6.5 percent in October.

In November capacity expanded by 6.1 percent reducing the industry load factor to 76.3 percent. IATA expects that growth will accelerate in coming months as demand drivers, such as consumer and business confidence, have continued to improve.

"Demand growth hit a speed bump in November but, with continued modest improvements in economic conditions, the outlook remains positive," Tony Tyler, IATA's Director General and CEO, commented.

All regions except Africa experienced higher traffic in November 2013 compared to November 2012, but all regions saw lower demand growth than in October.

  • Asia-Pacific carriers recorded an increase in demand of 5.5 percent compared to November 2012, on account of China and Japan's strengthened economies;
  • European carriers saw demand rise 4.1 percent year-on-year. During November, capacity expanded more quickly, by 4.8 percent, leading to a 0.5 percentage point dip in the load factor to 77 percent;
  • North American airlines saw demand rise 1.7 percent over the 2012 period. Capacity rose 4.7 percent causing load factor to fall 2.2 percentage points to 77.5 percent;
  • Middle East carriers saw the strongest year-over-year demand growth in November of 9.7 percent. Airlines in the region have benefited from strong growth in business-related premium travel throughout the year, particularly to Africa and other developing markets. Capacity rose 12.8 percent and load factor slipped two percentage points to 72.1 percent;
  • Latin American airlines experienced a 6.9 percent rise in demand in November, the second strongest growth recorded globally. Robust expansion in business-related travel is being driven by the strong performance of economies such as Colombia, Peru and Chile, IATA said. Capacity rose 3.6 percent and load factor climbed 2.4 percentage points to 79.4 percent, the highest for any region;
  • Africa was the only region to see a decline in demand in November with traffic falling 2 percent against November 2012. Capacity climbed 2.6 percent, pushing load factor down three percentage points to 63.5 percent, by far the lowest for any region.

Discussing developments during December, Tyler noted the United States's decision to hike the 9/11 Aviation Security Fee, from USD2.50 per passenger to USD5.60. He stated that: "It is ironic that in the United States – the country that gave birth to this amazing industry – political leaders in Washington agreed to raise taxes on air travellers to close the budget gap just a few days before we celebrated [the] momentous anniversary [of 100 years of commercial aviation, marked on January 1, 2014.] How much better would it be if, instead of seeing aviation and air travelllers as easy targets for USD12.6bn in new taxes, they shared in the vision that guided the pioneers who created this industry."

TAGS: aviation

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