Worldwide Passenger Growth Slowed in August

Boeing 747
Figures from the International Air Transport Association (IATA) showing global passenger traffic data for August revealed that demand (measured in total revenue passenger kilometers or RPKs) climbed 4.6% compared to the year-ago period. IATA said this represented a slowing from the 6.4% increase recorded in July. August capacity (available seat kilometers or ASKs) increased by 5.8%, and load factor slipped 0.9 percentage points to 83.8%.
“Growth in passenger demand dipped to 4.6%. While that’s disappointing compared to the previous month’s performance, it is still healthy growth. And although terrorist attacks in Europe have dampened demand, the impact is ebbing,” said IATA’s Director General and CEO, Alexandre de Juniac.”
August’s international passenger demand rose 4.7% compared to August 2015. All regions recorded increases, but growth was dominated by airlines in the Middle East. Capacity climbed 6.5%, causing load factor to slide 1.4 percentage points to 83.9%.
Demand for domestic travel climbed 4.3% in August compared to August 2015, which was slightly exceeded by a 4.4% increase in capacity. Load factor slid 0.1 percentage points to 83.6%. IATA said all markets reported demand increases with the exception of Brazil and Russia, with India and China reporting double-digit rises.
It concluded that the “Bottom Line” is that lower airfares are a major factor sustaining demand for air travel and airline profitability is stronger than ever as a result of a better industry structure and efficiency gains. However, Mr de Juniac noted: “The lingering impact of terrorist attacks in Europe earlier in the year reminds us that the aviation industry is vulnerable to many external factors beyond its control.
“The risks – Including the normal ups and downs of the business cycle – won’t go away. The industry has improved resilience along with its profitability. That will be critical to responding quickly should the business environment change.”