Strong Demand Growth Returns in November: IATA
The International Air Transport Association (IATA) reports global passenger traffic results for November showing the strongest demand growth in nine months.
Total revenue passenger kilometers (RPKs) rose 7.6% compared to November 2015. Capacity (available seat kilometres or ASKs) increased by 6.5%, and load factor rose 0.8 percentage points to 78.9%.
“Stronger demand for air travel reflects – and is supporting – a pick up in the global economic cycle. As the stimulus effect of lower oil prices recedes in the rear view mirror, the strength of the economic cycle will play a key role in the pace of demand growth in 2017,” said IATA director general Alexandre de Juniac.
November international passenger demand rose 8% compared to a year earlier, with airlines in all regions showing growth. Total capacity climbed 6.8%, and load factor edged up 0.9 percentage points to 77.1%.
North American airlines’ traffic climbed 1.5% in November. Traffic across the Pacific is growing rapidly, but North Atlantic demand is moderating. Capacity rose 1.2% and load factor edged up 0.2 percentage points to 78.7%.
“The airline industry continues to deliver strong results. In 2017, for a third consecutive year, the industry’s return on invested capital will exceed the cost of capital. Passengers benefit from the industry’s success. Travel has never been more accessible – with great fares, many options and more destinations,” said de Juniac. “Nevertheless uncertainty lies ahead. The threat of terrorism, questions over the durability of the economic upswing, rising oil prices and increasing protectionist rhetoric are among the concerns. The industry has reshaped itself and strengthened its resilience to shocks. We should see another solid year of collective profitability for the airlines in 2017. But we must be vigilant.”
