ME carriers fly high in slowing global aviation industry

Iata says regional demand continues to outstrip capacity expansion

Middle East carriers were the strongest performers with demand outstripping capacity expansion in June while the global aviation industry continued slowing the growth, the International Air Transport Association (Iata) announced on Thursday.

Demand grew 18.2 per cent as compared to 13.4 per cent capacity expansion. Load factors stood at 78.6 per cent. In contrast to the overall market, the growth trend in this region has been robust throughout 2012, gaining a further 1.9 per cent in June compared to May.

In the air freight sector, Middle East carriers recorded a 17.9 per cent increase in demand against a 14.2 per cent increase in capacity. Middle Eastern airlines have been adding capacity to meet the need for moving goods between the Middle East and Africa and also toward Europe and Asia, Iata added.

Globally, Iata figures showed a continued slowing of growth in the demand for air transport in line with weakness in business and consumer confidence.

Year-on-year, demand for air travel in June expanded by 6.2 per cent. Capacity grew by a much more cautious 4.5 per cent leaving load factors at 81 per cent. While this appears to be a healthy growth rate, the growth trend since early 2012 has seen a slowdown. This is illustrated by isolating the February through June trend which shows 2 per cent annualized growth. That is a major slowdown from the 8 per cent annualized growth rate experienced from mid-2011 through to January 2012.

June air freight volumes recorded a 0.8 per cent increase compared to the previous year. This brings seasonally adjusted June demand about 2.5 per cent above the low reached in the fourth quarter of 2011. The global picture masks strong growth for Middle East airlines (17.9 per cent) and the improvement in North American air freight demand.

“The uncertainty that we see in the global economic situation is being reflected in air transport’s performance. Although there are some pockets of solid performance, it is difficult to detect a strong trend—positive or negative—at the global level. Passenger markets have been growing more slowly since the beginning of the year and freight markets gains have been mostly very weak. The net effect is a demand limbo as consumers and businesses hedge their spending while awaiting clarity on the European economic front,” said Tony Tyler, Iata’s Director General and CEO.

 

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