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Guarded Optimism Over October Traffic Figures

by Ulrika Lomas, Tax-News.com, Brussels

02 December 2010


The International Air Transport Association has published October traffic figures, which demonstrate a possible turning point for freight traffic after months of poor results.

The figures show that international passenger traffic during October was up 10.1% year-on-year while international freight traffic increased by 14.4%, again on that recorded in October 2009.

Welcoming the news, IATA's Director General and Chief Executive Officer, Giovanni Bisignani, said:

“As we approach the end of 2010, growth is returning to a more normal pattern. Passenger demand is 5% above pre-crisis levels of early 2008, while freight is 1% above. Where we go from here is dependent on developments in the global economy.  The US is spending more to boost its economy. Asia outside of Japan is barrelling forward with high-speed growth. And Europe is tightening its belt as its currency crisis continues. The picture going forward is anything but clear, but for the time being, the recovery seems to be strengthening.”

“Freight appears to be at a turning point,” Bisignani added, stating further that: “Since May, freight volumes have declined by 5%. October saw an end to the decline in freight with a slight uptick.”

“But a single month does not make a trend. And it remains to be seen if this is the stabilization in freight volumes or the start of an upward trend.”

IATA's figures show that over the first 10 months of the year, passenger demand grew by 8.5%, with a capacity expansion of 4.0%. A cargo capacity expansion of 9.2% was well below the demand increase of 24%. Forward schedules indicate a continuation of this trend, with a 7.5% passenger capacity increase planned for the half-year scheduling period beginning at the end of October.

Taking the international passenger demand figures in isolation, the 10.1% year-on-year increase is slightly below that recorded in September, at 10.7%, but both months were an improvement over August.

On a regional basis:

  • North American airlines posted a 12.4% demand increase over October 2009. October represented the fastest growth rate for the year. With a capacity increase of 11.9%, the load factor for North American airlines was pushed to 82.5%, the highest among all regions. Compared to pre-recession levels of early 2008, the region’s airlines are carrying 2% more traffic.
  • European carriers showed a 9.6% increase over October 2009. This is significantly better than the 8.6% growth reported for September.  European airline traffic grew by 1.5% from September to October and is now 4% higher than the pre-recession levels of early 2008.
  • Asia-Pacific carriers posted a 7.3% demand increase, ahead of a 5.3% increase in capacity. Volumes remain 1% below pre-crisis levels of early 2008.
  • African airlines recorded strong growth (13.3%) compared to October 2009. With a capacity increase of 8.9%, load factors improved to 71.8%.
  • Latin American airlines posted a comparatively weaker performance with a 4.9% increase in demand and a 0.7% drop in capacity. The region’s results remain skewed because of the bankruptcy of Mexicana.
  • Middle East carriers recorded the strongest growth for the month with an 18% increase in demand. This is despite the earlier Ramadan dates, which negatively skewed the numbers with a 1% fall in October traffic as compared to September. The region also had the largest capacity expansion at 13.7% compared to October 2009.

In terms of international cargo demand, October again saw lesser results to the 15.5% year-on-year increase recorded in September, recording a 14.4% increase on October 2009. Nonetheless, international freight volumes actually improved slightly from its September level on a seasonally adjusted basis.

Commenting, Bisignani said of the figures: “We are ending 2010 in much better shape than we were just 12 months ago. Airlines have turned losses into profit — albeit tiny. Despite the economic uncertainties people continue to fly. Airlines appear to be managing capacity in the upturn with a good deal of prudence, and cost control continues to be a main theme for airlines everywhere.”

TAGS: aviation

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