By Emmie V. Abadilla
Continuing trade tension among the most powerful countries has blunted people’s appetites to travel all over the world.
Global passenger traffic results was moderate for February, 2019 with total revenue passenger kilometers (RPKs) rising 5.3% versus the same period last year, so far, the slowest growth rate in more than a year but still in line with long-term demand trends, according to the latest statistics from the International Air Transport Association (IATA).
Monthly capacity (available seat kilometers or ASKs) increased by 5.4%, and load factor slipped 0.1 percentage point to 80.6%, which is still high by historic standards.
“After January’s strong performance, we settled down a bit in February, in line with concerns about the broader economic outlook,” noted Alexandre de Juniac, IATA’s Director General and CEO. “Continuing trade tensions between the US and China, and unresolved uncertainty over Brexit are also weighing on the outlook for travel.”
February international passenger demand rose 4.6% compared to February 2018, which was a slowdown from 5.9% growth in January. Capacity climbed 5.1%, and load factor dropped 0.4 percentage point to 79.5%. Airlines in all regions but the Middle East showed traffic growth versus the year-ago period.
Asia-Pacific airlines’ February traffic rose 4.2% compared to the year-ago period, a substantial slowdown from the 7.2% increase recorded in January. The timing of the Lunar New Year holiday in the first week of February this year may have shifted some traffic to January. Capacity increased 4.7% and load factor dipped 0.3 percentage point to 81.0%.
Middle East carriers recorded a 0.8% traffic decline in February compared to a year ago, the only region to report a drop year-over-year. Capacity rose 2.9% and load factor fell 2.7 percentage points to 72.6%. Broadly speaking, passenger volumes of the region’s airlines have been moving sideways for the past 12 15 months.
North American airlines’ traffic climbed 4.2% in February, a decline from 5.4% growth in January. Capacity rose 2.9% and load factor was up 1.0 percentage point to 79.0%.
Signs of softening economic activity at the end of 2018, in conjunction with the effects of ongoing tensions between the US and several of its trading partners, may be mitigated by the region’s low unemployment and generally sound economic backdrop.
Latin American airlines saw traffic rise 4.3% compared to February 2018, a slippage from 5.4% annual growth in January. Capacity increased by 5.6%, and load factor dropped 1.0 percentage point to 81.4%. Renewed economic and political uncertainties in a number of key countries may weigh upon air transport demand in coming months.
European carriers showed the strongest performance for a fifth consecutive month in February. Passenger demand increased by 7.6%, compared to a year ago, unchanged from January.
Europe’s continuing strong performance provides a paradox given Brexit concerns and signs of a softer economic outlook. Capacity rose 8.0% and load factor slid 0.3 percentage point to 82.3%, which still was the highest among regions.
African airlines experienced a 2.5% rise in traffic for the month compared to the year-ago period, down from 5.1% growth in January. Concerns over conditions in the largest economies are contributing to the slowdown.
Capacity rose 0.3%, and load factor climbed 1.5 percentage points to 69.7%.
On the other hand, domestic travel demand rose 6.4% in February compared to February 2018, down from 7.4% annual growth in January.
All markets except Australia reported increases in traffic, with India recording its 54th consecutive month of double-digit percentage growth. Domestic capacity climbed 5.8%, and load factor edged up 0.5 percentage point to 82.4%.