Preliminary traffic figures for the month of July released today by the Association of Asia Pacific Airlines (AAPA) show continued growth in both air freight demand and international passengers. Asia Pacific airlines saw a 6.4 per cent growth year-on-year in air freight demand supported by what the AAPA described as “encouraging growth in demand for exports from major regional manufacturing hubs”.
In an encouraging sign, for the third consecutive month, the expansion in capacity lagged growth in demand. In July, offered freight capacity increased by 3.2 per cent, leading to a two percentage point increase in the average international freight load factor to 65.3 per cent.
Overall, during the first seven months of this year, International air freight demand grew by 4.9 per cent marking a long overdue recovery in trade volumes after several years of weak global demand. Asia Pacific airlines also carried a combined total of 145.3 million international passengers, an increase of 4.7 per cent compared to the same period last year.
Commenting on the results, Andrew Herdman, AAPA director general said: “The sustained upward trend in both international passenger and cargo demand is very positive, and reflects continued growth in the emerging markets and a relatively stable global economic outlook. Nevertheless, Asia Pacific airlines are still facing very challenging business conditions, with additional capacity placing further downward pressure on fares and yields.
“As a result, revenue growth has been lacklustre, and profitability remains elusive for many of the region’s carriers. Airlines are carefully reviewing their existing fleet deployments and future capacity plans in the light of current market conditions, whilst maintaining tight cost controls. The general outlook for Asian airlines remains positive, but right now, I would say restoring margins is the key focus of management attention across the industry.”