African air travel up: IATA


The International Air Transport Association says African passenger demand was up 13.6% year-on-year in March, with load factors growing to 67.4% for the month. This is 3.3% better than the world average of 10.3%.

Cargo demand had also increased by 28.1% year-on-year in March, which was a further improvement on the 26.3% growth recorded in February. Global passenger numbers had grown by 9% in February.

IATA cautions however that du to the recession last year, March was a low point for international travel. It also warns that April’s figures will be down because of the week-long interruption of flights caused by the eruption of a volcano in Iceland.  ”European carriers were already showing the weakest recovery from the financial crisis through March. The volcanic ash crisis hit the weakest part of the industry the hardest. The majority of the US$1.7 billion in lost revenues was by Europe’s carriers. Passenger confidence is not affected and we expect a quick rebound. The combined impact of lost business and added costs will certainly hit the bottom line,” said IATA director-general and CE Giovanni Bisignani.
“March results show that the pace of the upturn is strong. But the trauma of the recession is not over. The industry has lost two years of growth, and passenger and freight markets are still 1% below early 2008 highs. Nonetheless, the pace of improvement, based on an improving global economic situation, is much faster than anybody would have expected even six months ago,” Bisignani added.

IATA also notes that the International Monetary Fund has revised global GDP growth forecasts from 3.0% to 4.3% for 2010.
“With a 78.0% load factor recorded in March, passenger load factors remain at record highs. While demand expanded by 10.3% in March, capacity increases stood at 2.0%, boosting the load factor and creating much tighter supply and demand conditions. Global capacity remains 3-4% below pre-crisis levels,” IATA adds.
“International freight markets are also experiencing tighter supply and demand conditions. The 28.1% improvement in demand outpaced the 5.3% capacity expansion in March. This drove freight load factors to 57.1% — the highest since November 2002 when international freight load factors stood at 58.8%.”

Regional demand patterns continue to reflect the asymmetrical nature of the economic rebound.

African carriers are now starting to see improving growth, having suffered market share declines for several years. During March, demand was up 13.6% and load factors grew to 67.4% for the month.

Asia-Pacific carriers posted strong demand growth of 12.6%, against a capacity expansion of 1.3%. The strength of the rebound in the region’s economies is supporting Asia-Pacific’s demand improvement. China’s economy grew by 11.9% in the first quarter while India’s economy is growing by 7.0%. There is also greater optimism for a return to economic growth in Japan.

European carriers posted traffic growth of 6.0%, considerably weaker than the global improvements, but better than the 4.0% growth in February.  This is the result of sluggish home economies and continuing high unemployment rates. European carriers reduced capacity by 0.8% compared to the previous year.

North American carriers posted a traffic growth of 7.8%, lagging the global average, although considerably improved from the 4.4% recorded in February.  Uncertainty over government budget cuts and tax increases is dampening demand for air travel, compared to other regions, particularly Asia-Pacific. North American carriers posted the highest load factor among the regions (81.6%) as a result of continuing careful capacity management.

Middle Eastern carriers recorded the strongest traffic growth at 25.9%. While economic growth of 5% in the region is supporting some of this increase, a large part is attributed to market share gains on long-haul markets, connecting passengers over Middle Eastern hubs. Load factors of 76.2% were slightly below the global average.

Latin American carriers posted the weakest growth of any region, increasing only 4.6% in March. This is in sharp contrast to February when the region’s carriers grew by 8.5%. The reduction is largely due to the impact of the earthquake in Chile.

Regarding cargo demand, IATA says global air freight is now within 1% point of recovering to its previous high point of early 2008. International air freight volumes shrank by over one quarter during the second half of 2008. “The upturn in the business inventory cycle has almost eliminated that decline, although the upturn for international air freight has taken twice as long as the collapse.” Despite the sluggish US economy, North American carriers have seen an international freight rebound (+32.2%),” IATA adds. Both export and import volumes are very strong in the emerging economies of Asia-Pacific (+34.1%) and in Latin America which recorded the strongest growth at 47.9%. European carriers showed the weakest improvement in freight demand at 11.7%, largely due to the slow economic recovery in the region.

Meanwhile, IATA has applauded the announcement by the European Commission of a comprehensive programme to provide relief to the air transport sector in the aftermath of extra-ordinary airspace closures resulting from the ash plume of an Icelandic volcano. “I applaud Vice Presidents Kallas, Almunia and Rehn for their quick action. Airlines lost revenues of US$1.7 billion in just six days, with the greatest impact on European carrier,” Bisagnani said earlier today. These urgent measures will provide much needed assistance to airlines at a time when their financial resources are stretched.”

Bisignani also urge Europe to speed up the implementation of a “Single European Sky”. “The events of last week clearly showed the need for the Single European Sky. I fully support Vice President Kallas in his efforts to accelerate the appointment of a European Network Manager by the end of this year. But that is one element of the Single European Sky,” Biagnani said. “We also need to accelerate plans for the implementation of functional airspace blocks and a performance framework to ensure that the system is delivering efficiencies. We are looking for a strong commitment from Europe’s transport ministers on all three of these elements when they meet on [Tuesday].”

IATA estimates that the reduced delays and greater efficiency that a Single European Sky will bring will save five billion euro and reduce carbon emissions by 16 million tonnes a year.

Pic: An Air Algerie ATR 72