CHINA: Even Asia can’t reverse gloomy outlook

March figures for global cargo and passenger traffic from the International Air Transport Association (IATA) point to a lethargic international freight growth of 3.2 per cent, significantly down from the 4.3 per cent growth recorded in the same period of 2007. Compared to the same month in the previous year, passenger demand increased 5.8 per […]


March figures for global cargo and passenger traffic from the International Air Transport Association (IATA) point to a lethargic international freight growth of 3.2 per cent, significantly down from the 4.3 per cent growth recorded in the same period of 2007. Compared to the same month in the previous year, passenger demand increased 5.8 per cent with load factors at nearly 78per cent.

IATA also cautioned that the March passenger growth was positively skewed by the Easter holiday period which was in April of the previous year. Adjusting for this distortion, real traffic growth in March was 4 per cent. The slowdown in the demand growth continues the sharp downward trend which began in December 2007 as the impact of the US credit crunch began to be felt in the airline industry.

Worse still, a slowdown in Asia-Pacifi c carrier traffic to a 4.3 per cent growth rate year-on-year appears to point to the fact that the region’s booming economies, which thus far immunised carriers in the region from the US slowdown, no longer provide that key buff er.

International passenger load factors were equally skewed by the Easter period. When adjusted to take into account artificially high utilisation over the Easter period, the March load factor was 76.1 per cent. While still high, this is 1.7 percentage points lower than the 77.8 per cent recorded for the same month in 2007. This fall indicated that the slowing of demand occurred faster than airlines could cut capacity.