EUROPE/CIS: IATA: Strong 2010 but uncertainties in 2011
The International Air Transport Association (IATA) reported full-year 2010 demand statistics for international scheduled air traffic that showed a 20.6 per cent increase in freight an 8.2 per cent increase in the passenger business. Demand growth outstripped capacity increases of 8.9 per cent for cargo and 4.4 per cent for the passenger side. The freight […]
March 1, 2011
The International Air Transport Association (IATA) reported full-year 2010 demand statistics for international scheduled air traffic that showed a 20.6 per cent increase in freight an 8.2 per cent increase in the passenger business. Demand growth outstripped capacity increases of 8.9 per cent for cargo and 4.4 per cent for the passenger side. The freight load factor saw a 5.2 percentage point improvement to 53.8 per cent while the average passenger load factor was 78.4 per cent. Compared to the pre-recession levels of early 2008, air freight volume was one per cent higher than pre-recession levels; however volumes have fallen five per cent since the peak of the postrecession inventory re-stocking boom in early 2010. “The world is moving again. After the biggest demand decline in the history of aviation in 2009, people started to travel and do business again in 2010. Airlines ended the year slightly ahead of early 2008 volumes, but with a pathetic 2.7 per cent profit margin. The challenge is to turn the demand for mobility into sustainable profits,” said Giovanni Bisignani, IATA’s director general and CEO. Severe weather Europe and North America in December put a dent in the industry’s recovery. It is estimated that this shaved one per cent off of total traffic demand for the month. Freight demand growth varied wildly over the year from a high of 35.2 per cent in May to a low of 5.8 per cent in November. Overall the industry is trending towards normal growth pattern in line with the historical growth rate of 5-6 per cent, IATA said. Regional variation in growth remains particularly marked, it noted, with Latin American carriers recording the highest full-year growth rate of 29.1 per cent, followed by Middle East carriers (accounting for 11 per cent of the market) at 26.7 per cent, Asia Pacific airlines (with a 45 per cent market share) grew by 24 per cent, Africa at 23.8 per cent and North America by 21.8 per cent. Against these industry gains, Europe’s 10.8 per cent growth stands out as exceptionally weak. “The story this month is the sharp rise in oil prices. We predicted that 2011 would see a consecutive second year of profitability but with industry profits falling by 40 per cent to US$9.1 billion. This was based on an oil price of $84 per barrel (Brent). Fuel accounts for 27 per cent of operating costs and a sustained rise in the oil price could spoil the party,” said Bisignani..