IATA says global traffic continues to slow

MANILA, Philippines - Global air traffic continued to slow in September, with the Asia Pacific region, including the Philippines, registering a decline in the international passenger market.

The International Air Transport Association (IATA) noted that growth in air travel started to flatten in the second quarter, with no growth in the passenger market between April and August. The year-on-year comparisons are now also starting to show slower rates of growth.

 In September, passenger travel increased 4.1 percent on a year ago, down from the 5.3 percent year-on-year growth rate in August and well below the six percent average growth rate seen throughout the first half of the year.

 The minor 0.6 percent year-on-year growth posted for air cargo is less significant than the 0.6 percent fall in air freight volumes between August and September, which is more indicative of the trend, IATA said.

 IATA director general and chief executive officer Tony Tyler said a ‘two-speed’ recovery is emerging into a ‘multi-speed’ reality.

Tyler pointed out that carriers in China, Latin America and the Middle East are growing strongly while Europe’s airlines are experiencing profitless growth in a strategy to manage high fixed costs and taxes.

 He said the challenge in Africa is to turn growth opportunities into profits and for North American airlines to focus on tightly managing capacity in order to optimize profits in a slow to no-growth environment.

He pointed out that Asia-Pacific carriers outside of China are a mixed bag. Robust growth in China is being tempered by faltering markets in Japan and India.

 “Putting regional diversity aside, the fact that airlines are making any money at all with weak markets and high fuel prices is a tribute to their strong business performance, as evidenced by maintaining global load factors close to 80 percent since the start of 2012. Even with that, airlines are expected to eke out a global net profit margin of only 0.6 percent. It’s a tough year,” Tyler said.

 Statistics showed that international passenger demand climbed 4.9 percent in September compared to the year-ago period, with all regions reporting traffic growth.

 Only Asia Pacific carriers experienced a decline compared to August while European airlines experienced 5.4 percent growth. Asia-Pacific was one of the weakest regions, as demand rose just 1.7 percent year-on-year.

 North American airlines’ international traffic climbed 2.1 percent in September while Middle East carriers experienced by far the strongest traffic growth, with demand up 13.3 percent year-on-year.  Latin American airlines posted growth of 7.5 percent, second highest among the regions.

“Tough times deliver innovation. High oil prices have turned fuel management into a fine art of conserving every last drop. Consumer demand for convenience and simplified process supported the development of a whole new way to travel facilitated by e-tickets, bar-coded boarding passes and kiosk technology,” Tyler said.