Middle East airlines demand still growing

Iata director-general and CEO Alexandre de Juniac.

The International Air Transport Association (Iata) announced global passenger traffic results for September showing that demand - measured in revenue passenger kilometres, or RPKs - rose 5.7 per cent compared to the same month in 2016. Carriers in the Middle East had a 3.7 per cent rise in demand, though it was the slowest since February 2009.
The September numbers are the slowest year-on-year increase since February. Hurricanes Irma and Maria weighed heavily on the results, although growth already had been tapering. Capacity climbed 5.3 per cent and load factor edged up 0.3 percentage points to 81.6 per cent, which was a record for September.
"September's growth in passenger demand was healthy, notwithstanding the heavy impacts of extreme weather events on the Americas," said Alexandre de Juniac, the Iata's director-general and CEO. "Global economic conditions support rising passenger demand, but with higher cost inputs, the demand stimulation from lower fares has waned, suggesting a moderating trend in traffic growth."
International RPKs climbed 6.5 per cent with airlines in all regions recording growth compared to 2016. Total capacity climbed 5.6 per cent, and load factor rose 0.7 percentage points to 81.3 per cent.
Asia-Pacific airlines' traffic rose 8.7 per cent in September compared to the year-ago period, the strongest growth among regions. Capacity increased 7.8 per cent, and load factor climbed 0.6 percentage points to 78.3 per cent. A solid regional economic backdrop, helped by robust growth in China, is supporting passenger demand within the region.
European carriers saw September demand rise 7.1 per cent over September 2016, in line with August growth of seven per cent. The upward trend in seasonally-adjusted demand has slowed considerably since May, but business confidence remains high and the economic backdrop is supportive. Capacity rose 5.2 per cent and load factor surged 1.6 percentage points to 86.8 per cent, which was the highest among regions.
The Middle East-US market has been hit hard by the now-lifted cabin ban on large portable electronic devices, as well as the various proposed travel bans to the US. Traffic between the region and the US has fallen for six consecutive months through August (the most recent month for which route data are available). Capacity rose 4.3 per cent, and load factor slipped 0.4 percentage points to 74.5 per cent.
North American airlines experienced a three per cent rise in demand. Capacity rose 3.6 per cent and load factor fell 0.5 percentage points to 81 per cent. In addition to the impacts of hurricanes Irma and Maria, anecdotal evidence continues to suggest that inbound traffic to the US is being deterred by additional security measures now involved in travelling to the country.
Latin American airlines' performance also was affected by hurricane activity but strong underlying demand meant that traffic rose 8.5 per cent compared to the same month last year. Capacity climbed at the same rate and load factor was flat at 82.2 per cent, the second highest among regions.
African airlines posted a 3.6 per cent rise in traffic in September, down from 6.5 per cent in August. Capacity rose 0.3 per cent and load factor jumped 2.4 percentage points to 73.8 per cent. Conditions in the region's two largest economies - Nigeria and South Africa - are diverging again, with business confidence levels in South Africa consistent with falling output.
Domestic demand climbed 4.2 per cent in September compared to September 2016, heavily affected by weather disruptions in the US market, which accounts for more than 40 per cent of all domestic RPKs. India and China continued to lead all markets with double-digit annual traffic increases while elsewhere, results were mixed. Capacity rose 4.7 per cent and load factor slipped 0.4 percentage points to 82.2 per cent.
US domestic traffic fell 1.2 per cent, reflecting the hurricane impacts. With operations at affected major airports having returned to normal, it appears the disruption will be short-lived.
Japan's domestic traffic also took a weather-related hit as Typhoon Talim caused a significant slowing of traffic growth from the 8.8 per cent recorded in August to 3.6 per cent in September. As with the US, the impact is expected to be temporary.
- business@khaleejtimes.com
 
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De Juniac expressed the aviation industry's solidarity with the victims of the hurricanes, and emphasized the importance of aviation's ability to deliver aid and support. "Our hearts go out to all those affected by the recent extreme weather events, which uprooted lives and communities and dealt heavy blows to local economies in the affected areas. It is at times like these that we truly see the vital role that aviation plays in disaster relief, bringing in much needed first responders and aid workers, as well as supplies, food and medicines to those in need," said de Juniac.