IATA announces surge in travel demand

IATA Reports Slow Growth in 2015

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The International Air Transport Association (IATA) announced on 5 February 2016 global passenger traffic results for 2015 showing demand (revenue passenger kilometres or RPKs) rose 6.5 per cent for the full year compared to 2014. This was the strongest result since the post-Global Financial Crisis rebound in 2010 and well above the ten year average annual growth rate of 5.5 per cent. While economic fundamentals were weaker in 2015 compared to 2014, passenger demand was boosted by lower airfares. After adjusting for distortions caused by the rise of the US dollar, global airfares last year were approximately five per cent lower than in 2014.

“Last year’s very strong performance, against a weaker economic backdrop, confirms the strong demand for aviation connectivity. But even as the appetite for air travel increased, consumers benefited from lower fares compared to 2014” said Tony Tyler, IATA’s Director General and CEO.

Annual capacity rose 5.6 per cent last year, with the result that load factor climbed 0.6 percentage points to a record annual high of 80.3 per cent. All regions experienced positive traffic growth in 2015. Carriers in the Asia-Pacific region accounted for one-third of the total annual increase in traffic.

European carriers’ international traffic climbed 5.0 per cent in 2015. Capacity rose 3.8 per cdent and load factor increased 1.0 percentage point to 82.6 per cent, highest among the regions. The healthy result in part was attributable to a pick-up in consumer spending in the Eurozone as well as a moderate increase in flight frequencies. Traffic growth slowed toward the end of the year owing to strikes at Lufthansa and the shut down of Russia’s Transaero.Asia Pacific carriers recorded a demand increase of 8.2 per cent compared to 2014, which was the largest increase among the three largest regions. Demand was stimulated by a 7.3 per cent increase in the number of direct airport connections in the region, resulting in time-savings for travellers. Capacity rose 6.4 per cent, pushing up load factor 1.3 percentage points to 78.2 per cent. International passenger traffic rose 6.5 per cent in 2015 compared to 2014. Capacity rose 5.9 per cent and load factor rose 0.5 percentage points to 79.7 per cent. All regions recorded year-over-year increases in demand.

North American airlines saw demand rise 3.2 per cent in 2015, broadly unchanged from the growth achieved in 2014. Capacity rose 3.1 per cent, edging up load factor 0.1 percentage points to 81.8 per cent.

Middle East carriers had the strongest annual traffic growth at 10.5 per cent. As a result, the share of international traffic carried by Middle East airlines reached 14.2 per cent, surpassing their North American counterparts (13.4 per cent). Capacity growth of 13.2 per cent exceeded the demand gains, pushing down load factor 1.7 percentage points to 76.4 per cent.

Latin American airlines’ traffic rose 9.3 per cent in 2015. Capacity rose 9.2 per cent and load factor inched up 0.1 percentage points to 80.1 per cent. While key regional economies, particularly Brazil, have been struggling, overall traffic has been robust.

African airlines had the slowest annual demand growth, up 3.0 per cent, although this was a significant improvement over the 0.9 per cent annual growth achieved in 2014. With capacity up just half as much as traffic, load factor climbed one percentage point to 68.5 per cent. International traffic rose strongly in the second half of 2015, in conjunction with a jump in trade activity to and from the region.

Domestic air travel rose 6.3 per cent in 2015. All markets showed growth, led by India and China but there was wide variance. Capacity rose 5.2 per cent and load factor was 81.5 per cent, up 0.9 percentage points over 2014.

Brazil’s domestic air travel rose just 0.8 per cent in 2015, reflecting the country’s deteriorating economic situation. Traffic trended downward throughout the year.

US domestic traffic climbed 4.9 per cent last year, helped by solid economic growth. This was the fastest rate of increase since 2004 and the first time since 2003 that domestic traffic growth surpassed international growth. The load factor reached a domestic record high of 85.4 per cent.

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