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June passenger demand is up, says IATA, but trade disputes casting “a long...

June passenger demand is up, says IATA, but trade disputes casting “a long shadow”

Thursday, August 9, 2018

GENEVA — Global passenger traffic results for June show that demand is up, says IATA, with the first six months of 2018 having a “strong performance”.

Demand (measured in total revenue passenger kilometres, or RPKs) in June rose by 7.8% compared to June 2017, following a 6.0% year-over-year growth recorded in both May and April. June capacity (available seat kilometres or ASKs) increased by 6.5%, while load factor rose 1.0 percentage point to 82.8%.

The first half of 2018 produced demand growth of 7.0%, a strong performance says IATA, but still down from the 8.3% growth recorded in the first half of 2017.

“The first half of 2018 concluded with another month of above-trend demand growth, which is a good indicator for the peak summer travel season in the northern hemisphere. But the looming prospect of a global trade war is casting a long shadow. Additionally, rising cost inputs – fuel prices have soared by approximately 60% over the past year—are reducing the stimulus of lower fares,” said Alexandre de Juniac, IATA’s Director General and CEO.

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All regions recorded growth in June, led by airlines in the Middle East and Africa. North American airlines’ demand rose 5.9% compared to June a year ago, an improvement from 5.0% growth recorded in May, while capacity climbed 3.6% and load factor increased 1.9 percentage points to 86.7%.

Increasing momentum in the U.S. economy is supporting growth in passenger volumes, but prospects of further escalation in trade disputes could affect future demand.

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