8-Sep-2016 7:55 AM

IATA: Jul-2016 traffic shows global resilience, but economic underpinnings still fragile

IATA released (07-Sep-2016) its 'Air Passenger Market Analysis' for Jul-2016'. Key highlights include:

  • Jul-2016 industry wide traffic grew 5.6% year-on-year, exhibiting "resilience into the peak summer period".
  • Industry-wide load factor was 83.7%, down just 0.1 percentage point lower from the record July high reached in 2015;
    • Industry load factor has remained in a narrow band around 80% since Feb-2016, as airlines have slowed capacity growth in line with the moderation in growth;
  • Growth was strongest with Middle Eastern carriers (+12.5%), followed by airlines in Asia Pacific (+9.6%);
    • There remains little sign of any slowdown in the strong upward trend in traffic in the Middle East and there are signs that with signs that the upward trend in seasonally-adjusted traffic in the Asia Pacific is reasserting itself.
  • Growth was slowest in North America (+2.8%) and Latin America (+2.9%);
    • North American carriers’ international traffic has  picked up in recent months with seasonally-adjusted volumes have risen at an annualised rate of more than 8% since Mar-2016, helped by an improvement across the Pacific route and on tourist routes to Central America and the Caribbean;
  • International demand for European carriers was 3.4%. Europe is the largest region in terms of international RPKs and growth has been affected by recent terrorist attacks and political instability in parts of the region;
    • Reports also suggest that Asian passengers are being put off by terrorism in Europe: traffic on the Europe-Asia route fell by 0.9% year-on-year in Jun-2016, and it has been the weakest-performing major route so far in 2016.
  • African international traffic jumped +7.4% in Jul-2016, related mostly to the strong upward trend in (seasonally
    adjusted) traffic during 2H2015;
  • Global market developments exhibit a mixed influence on growth:
    • Headwinds include lingering impacts from high-profile terrorist attacks and political instability in parts of Europe, as well as the ongoing fragile economic backdrop. Global business confidence has edged up in recent months, but the economic remains highly uncertain, Tailwinds include lower fares, which are a function of lower oil prices continuing to feed through, as well as wider competitive pressures in the market;
    • Negative influences on demand growth have tended to dominate throughout much of 2016 so far, and industry-wide growth momentum has eased somewhat, translating into year-to-date traffic growth of 5.5% over the first seven months of 2016 (compared to 6.3% for the same period in 2015).
  • 2016 passenger traffic has still grown broadly in line with the average pace seen over the past decade or so. [more - original PR]

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