Air transport markets weaken in November

The International Air Transport Association (IATA) reports global traffic results for November showed a softening in passenger markets compared to a year ago. While passenger traffic was 4.3% above November 2010 levels, IATA officials say this is skewed as November 2010 was a particularly weak month. The softening in passenger markets becomes apparent when comparing to the previous month (October 2011). This shows a 0.5% decline on a seasonally adjusted basis. “Weak global economic performance is being reflected in air transport markets. Freight markets have contracted some 4% compared to January. Although passenger markets have had some growth relative to the beginning of the year – about 2% – the trend has been both soft and volatile,”says IATA director general Tony Tyler. “Continuing economic uncertainty will likely mean market shortcomings deepening as we enter 2012.”Globally, passenger load factors have fallen sharply to 76.3% from 78.5% in October. This shows that the weakness in passenger demand is outpacing airlines’ ability to adjust capacity accordingly. Regional differences are sharp. While North American carriers saw a 0.8% decline in travel, carriers in the Middle East experienced a 10.1% increase, followed by 9.0% for Latin American airlines. International travel markets continue to be weaker than domestic markets. Compared to October, international demand contracted by 1.5% while domestic demand grew by 1.3%. North American airlines saw international demand shrink by 1.2% (compared to November 2010), roughly in line with a 1% reduction in capacity. The fourth quarter uptick in the US economy has yet to be reflected in passenger markets.