IATA: Passenger demand losing momentum in June

iata-logo (1)Global passenger traffic for June rose by 5.2% compared to the same year-ago period, up slightly from the 4.8% in-crease recorded from revised figures in May, reports the International Air Transport Association (IATA). However, IATA notes that the upward trend in seasonally-adjusted traffic has moderated since January.

International passenger demand rose 5.0% in the month compared to June 2015, and demand for domestic travel climbed 5.7%.

“The demand for travel continues to increase, but at a slower pace. The fragile and uncertain economic backdrop, political shocks and a wave of terrorist attacks are all contributing to a softer demand environment,” said Tony Tyler, IATA’s Director General and CEO.


International Passenger Markets 
For June, all international passenger regions recorded growth, led by airlines in Latin America. Capacity climbed 6.4%, causing load factor to slide 1.1 percentage points to 79.4%.

     North American airlines’ demand rose 4.0% compared to June a year ago, which was well up on the 0.5% year-over-year growth recorded in May. Capacity climbed 4.7%, causing load factor to dip 0.6 percentage points to 84.3%, still the highest among regions.

     Latin American airlines experienced an 8.8% rise in demand compared to the same month last year, suggesting that carriers there have flown out of the soft patch seen in the first quarter. Capacity increased by 5.2% and load factor rose 2.7 percentage points to 82.4%.

     Asia-Pacific airlines’ June traffic increased 8.2% compared to the year-ago period. IATA points out that most of the growth relates to the strong upward trend in traffic seen in the final months of 2015 and into 2016, with June demand barely higher than in February.

     European carriers saw demand rise 2.1%, the smallest increase among regions, reflecting the negative impact of recent terrorism. While demand tends to recover reasonably quickly after such events, the repeated nature of the attacks may have a more lasting impact.

     Middle Eastern carriers posted a 7.5% traffic increase in June, which was well down on the double-digit growth recorded earlier in the year. In part this could be owing to the timing of

Ramadan, which tends to depress traffic growth.

     African airlines’ traffic climbed 4.7% in June, an indication that the strong upward trend in demand that began in the second half of 2015 has paused. Capacity rose 7.4%, with the result that load factor slipped 1.7 percentage points to 64.4%, lowest among regions.


Domestic Passenger Markets
     Demand for domestic travel climbed 5.7% in June compared to June 2015, while capacity increased 4.3%, causing load factor to rise 1.1 percentage points to 83.2%. All markets reported demand increases with the exception of Brazil.

India continued to lead all markets with a 23.3% rise in domestic traffic, followed by China P.R. up 11.3% and the U.S., up by 4.5%