Global passenger and air freight demand grew in June

1 August 2013 (Last Updated August 1st, 2013 18:30)

Global year-on-year passenger and air freight demand rose 6% and 1.2% respectively in June 2013, according to the latest International Air Transport Association (IATA) report.

IATA aircraft movements (Dubai Airport)

Global year-on-year passenger and air freight demand rose 6% and 1.2% respectively in June 2013, according to the latest International Air Transport Association (IATA) report.

During the period, passenger capacity rose 5.6%, pushing the load factor to 81.7%, compared to the corresponding period in 2012.

IATA director general and CEO Tony Tyler said that June was a positive month for passenger markets, with the stability in the Eurozone, albeit tentative, is giving a boost to business and consumer confidence.

"And the load factor at 81.7% shows that airlines are efficiently meeting increasing demand for travel. But there are some headwinds," Tyler said.

"Growth in the BRICS economies, including China, is slowing. And oil prices remain high. The industry is still on track to make $4.00 per passenger this year for a global net profit of $12.7 billion.

"But there is little margin for error and even a small change in the second half of the year could shift the outlook significantly."

While strong growth was reported in all regions, Asia-Pacific airlines accounted for about half of the increase in revenue passenger kilometres (RPK) in June.

Air carriers in the Middle East reported highest growth in international traffic with 12.1%, followed by Africa (11.2%), Latin America (8.7%), Asia-Pacific (5.5%), Europe (4.7%) and North America (3.4%).

China topped the list of domestic airline traffic market with a 14.6% rise, followed by Russia (9.8%), India (7.7%), Japan (6.9%), Brazil (3.25) and the US (2.4%).

It is too early to tell if June was a positive turning point after 18 months of stagnation."

Global freight volumes rose 0.8% in June and European airlines accounted for a quarter of the growth, reporting a 2.6% rise compared to June 2012, while Asia-Pacific and North American carriers reported respective declines of 1.8% and 1.2%.

According to Tyler, it is too early to tell if June was a positive turning point after 18 months of stagnation.

"Air freight volumes are at their highest since mid-2011, but that good news needs to be tempered with a dose of reality," Tyler said.

"The global economic environment remains weak, and the basis for the acceleration of air cargo growth in June appears to be fragile."

During the initial six months (H1) of 2013, global year-on-year passenger and air freight demand grew 4.8% and 0.1% respectively.

Passenger capacity during January to June 2013 rose 3.9%, pushing the load factor to 79%.

"The half-year report for passenger markets is broadly positive," Tyler added. "There is plenty of evidence to support some cautious optimism. Airlines are expecting continued growth in demand, but there is little immediate hope for an improvement in yields.

"In the short term, cost control remains high on every airline's agenda. And the longer-term challenge is to expand value streams to generate sustainable levels of profitability."


Image: Middle-East airlines reported highest growth in international traffic with 12.1% rise in June 2013.