By Emmie V. Abadilla
The later timing of the Lunar New Year as well as concerns over a possible trade war involving the US-dampened global market confidence and spilled over into the demand for air travel.
So, while global passenger traffic results, as shown in Revenue Passenger Kilometers (RPKs) rose 4.6 percent for January, 2018 versus the same period last year, this was “the slowest year-over-year increase in nearly four years,” according to the International Air Transport Association (IATA).
The impact of the later Lunar New Year-related travel period holiday represented around two-fifths of the slowdown in year-over-year growth for the month, the IATA estimated.
January capacity, in terms of Available Seat Kilometers (ASKs) rose 5.3 percent and load factor slipped half a percentage point to 79.6 percent.
“Despite the slower start, economic momentum is supporting rising passenger demand in 2018,” noted Alexandre de Juniac, IATA’s Director General and CEO.
International passenger demand growth slowed to 4.4 percent in January, from 6.1 percent in December, with all regions recording growth, led by Latin America and Europe. Capacity rose 5.3 percent and load factor dipped 0.7 percentage point to 79.6 percent.
Asia-Pacific carriers recorded a demand increase of 4.6 percent versus January, 2017 – a 46-month low. This was due to the impact of the later Lunar New Year, which fell in mid-February this year. Capacity rose 6.1 percent, and load factor dropped 1.2 percentage points to 80.4 percent.
Middle East carriers had the weakest growth, with demand up just 0.5 percent compared to January 2017, the slowest pace since September 2008.
The market to and from North America has been especially hard hit owing to factors including the temporary ban on large portable electronic devices as well as the proposed travel bans to the US from some countries in the region.
Capacity climbed 4.6 percent and load factor fell 3.1 percentage points to 76.8 percent.
North American airlines experienced a 3.5 percent rise in traffic over a year ago, but capacity rose 4.3 percent and load factor dipped 0.7 percentage point compared to a year ago to 79.6 percent. The relatively healthy economic backdrop in the region is helping support outbound demand but this is being partly offset by a negative impact on inbound traffic to the US.
Latin American airlines’ traffic climbed 7.3 percent in January compared to January 2017, strongest among the regions. Capacity rose 8.2 percent, however, and load factor slipped 0.7 percentage point to 82.6 percent, which was the highest among the regions.
Stronger economic conditions in Europe are helping support rising demand on the market between Europe and South America in particular.
European carriers’ international traffic climbed 6.0 percent in January compared to the year-ago period, up from 5.8 percent growth in December 2017.
The region was the only one with accelerated traffic compared to the month before. This was supported by the buoyant economic conditions in the region. Capacity rose 5.0 percent and load factor was up 0.7 percentage point to 80.8 percent.
African airlines saw January traffic rise 4.9 percent against a mixed backdrop for the region’s largest economies.
In Nigeria, business confidence has risen sharply while in South Africa, political uncertainly continues to inflict an economic toll. The region’s capacity rose 4.2 percent, and load factor edged up 0.5 percentage point to 70.3 percent.