International Freight Forwarder Association

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IATA Economics

Tuesday, May 3, 2011

  • Air travel markets shrank for the second consecutive month in March, impacted by the situation in Japan, unrest in MENA and high fuel prices;
  • Scheduled international RPKs were 3.8% higher in March than a year earlier, down from the 5.8% growth of February;
  • Air freight markets rebounded a little from depressed February levels with growth of 3.7% in March, compared to 1.8 % in February;
  • The disruption to air travel caused by the March 11 earthquake and tsunami led to domestic air travel in Japan falling by 22%;
  • The situation in Japan is estimated to have cut growth by 1% point on international air travel markets;
  • The impact was most severe on airlines in the Asia-Pacific region whose growth is estimated to have been reduced by more than 2% points;
  • Egypt and Tunisia continue to see much lower than normal travel while Libyan markets have been virtually closed in March;
  • All of these disruptions in MENA are estimated to have reduced international air travel by 0.9% points in March;
  • In the absence of the disruptions in Japan and MENA international air travel would have been continuing to grow close to trend at 6%;
  • Fairly positive economic growth forecasts, despite high energy costs, suggest that second half travel and freight markets will recover from the current disruptions;
  • However, weakness due to the Japan and MENA situations are expected to continue to depress air transport demand during the second quarter;
  • Capacity growth has slowed but continued at a much faster rate than traffic during February and March;
  • Load factors have fallen substantially as a result - on passenger markets load factors in March were almost 4% points below the peak levels of mid-2010;
  • Revenues will have suffered from lower unit revenues and weaker supply-demand conditions may make it more difficult to recoup high fuel costs without damaging demand.