Traffic on the Asia-Europe route has recovered strongly since last year's terrorism-related disruption, surging at an annualized rate of more than 26% since November.
The International Air Transport Association(IATA) announced global passenger traffic results for May showing that demand (measured in revenue passenger kilometers, or RPKs) rose 7.7% compared to the same month in 2016. This was slower than the 10.9% growth recorded in April. However, this still was well ahead of the 5- and 10-year average growth rates. Capacity climbed 6.1%, and load factor rose 1.2 percentage points to 80.1%, which was a record high for the month. All regions, excluding the Middle East and North America, posted record-high May load factors.
After adjusting for inflation, airfares at the start of the second quarter were around 6% lower than a year ago. IATA estimates that this contributed to around two-fifths of the annual growth in passenger traffic seen in May. However, the degree of fare stimulus is around half that seen in the second half of 2016. This stimulus is likely to fade further in light of rising airline cost pressures, while business confidence has softened. However, passenger demand is likely to remain well supported during the upcoming peak travel months of July and August.
“Passenger demand is solid. And we don’t foresee any weakening over the busy summer months in the Northern Hemisphere. But the rising price of fuel and other input costs is likely to see airlines’ ability to stimulate markets with lower fares taper over the coming months. In parallel, rising trade protectionism and barriers to travel are worrying trends that, if unchecked, could impact demand. As a business airlines depend on borders that are open to trade and people,” said Alexandre de Juniac, IATA’s Director General and CEO.
|
May 2017 (% year-on-year) |
World share¹ |
RPK |
ASK |
PLF (%-pt)² |
PLF (level)³ |
|
Total Market |
100.0% |
7.7% |
6.1% |
1.2% |
80.1% |
| Africa |
2.2% |
10.4% |
4.6% |
3.6% |
68.2% |
|
Asia Pacific |
32.8% |
11.8% |
8.6% |
2.2% |
79.6% |
|
Europe |
26.5% |
7.7% |
5.6% |
1.6% |
82.2% |
|
Latin America |
5.2% |
7.3% |
5.5% |
1.4% |
80.5% |
|
Middle East |
9.6% |
3.8% |
5.9% |
-1.4% |
70.0% |
|
North America |
23.7% |
3.9% |
3.6% |
0.2% |
84.0% |
¹% of industry RPKs in 2016 ²Year-on-year change in load factor ³Load factor level
International Passenger Markets
International traffic demand rose 7.6%, with airlines in all regions recording growth, led by airlines in Africa for a second consecutive month. Total capacity climbed 5.7%, with load factor rising 1.4 percentage points to 78.5%.
- Asia-Pacific airlines saw their traffic rise 10.5% in May compared to the year-ago period. Capacity increased 7.2%, and load factor jumped 2.3 percentage points to 77.6%. Traffic on the Asia-Europe route has recovered strongly since last year’s terrorism-related disruption, surging at an annualized rate of more than 26% since November. Meanwhile, traffic on inter-Asia routes remains robust.
Domestic Passenger Markets
Domestic demand rose 7.9% in May compared to May 2016, down slightly from the 8.1% year-on-year growth recorded in April. Results varied widely, with China, India, Japan and Russia showing double-digit percentage growth while other regions were in the low single-digit range.
|
May 2017 (% year-on-year) |
World share¹ |
RPK |
ASK |
PLF (%-pt)² |
PLF (level)³ |
|
Domestic |
36.3% |
7.9% |
6.9% |
0.8% |
83.0% |
| Australia |
1.0% |
1.0% |
-3.1% |
3.1% |
77.9% |
|
Brazil |
1.2% |
2.6% |
3.3% |
-0.5% |
77.9% |
|
China P.R |
8.7% |
16.8% |
14.4% |
1.7% |
83.9% |
|
India |
1.3% |
17.7% |
14.7% |
2.3% |
88.6% |
|
Japan |
1.1% |
10.3% |
2.6% |
4.8% |
69.1% |
|
Russian Fed. |
1.3% |
12.8% |
12.6% |
0.1% |
77.2% |
|
US |
15.0% |
3.4% |
3.3% |
0.1% |
86.1% |
¹% of industry RPKs in 2016 ²Year-on-year change in load factor ³Load factor level *Note: the seven domestic passenger markets for which broken-down data are available account for 30% of global total RPKs and approximately 82% of total domestic RPKs
- Japan‘s domestic traffic surged 10.3% year-over-year, which was close to a five-year high. The rise in demand far outpaced the growth in capacity (2.6%) and domestic load factor jumped to a record high for May of 69.1%, although this was still the lowest among the markets. This performance continues to be set against a comparatively robust economic backdrop including economic expansion for five consecutive quarters, which is the longest run in more than a decade.
View the full May passenger traffic analysis here. (pdf)
Tatiana is the news co-ordinator for TravelDailyNews Media Network (traveldailynews.gr, traveldailynews.com and traveldailynews.asia). Her role includes to monitor the hundrends of news sources of TravelDailyNews Media Network and skim the most important according to our strategy. She holds a Bachelor degree in Communication & Mass Media from Panteion University of Political & Social Studies of Athens and she has been editor and editor-in-chief in various economic magazines and newspapers.
