Passenger demand growth stays strong as airlines match 83.4% record high load factor

GENEVA — Global air passenger traffic results for August show a strengthening of the healthy demand trend of the last few months, says IATA.

Total revenue passenger kilometers (RPKs) rose 6.8% compared to August 2012. Capacity increases over the year-ago period lagged demand at 5.6%. This pushed the load factor to match the record high of 83.4% set in July 2011.

“August was a positive month for passenger travel. Strong demand and capacity discipline saw load factors match the previous record high of 83.4%. The solid performance was also supported by a stabilization of emerging market weakness and renewed confidence in Europe and North America. Trading conditions are still tough with high oil prices, stiff competition and regulatory hurdles. But demand growth remains a bright spot with most indications pointing towards an acceleration in the fourth quarter,” said Tony Tyler, IATA’s Director General and CEO.

August international passenger demand was up 7.5% compared to the year-ago period. Capacity rose 5.6% versus August 2012 and load factor climbed 1.5 percentage points to 84.0%. All regions recorded year-over-year increases in demand.

North American airlines saw demand rise 5.1% over a year ago, the slowest growth for any region but still close to double the year-to-date increase of 2.7%. This is consistent with indicators of a more supportive business environment, although manufacturing activity remains below the average seen at the start of 2013. A 4.0% rise in capacity meant that load factor climbed one percentage point to 88.1%, the highest for any region. Looking ahead, the U.S. Government shutdown is not expected to impact airline operations but could dampen demand. The 27-day shutdown in 1996, for example, resulted in delays for tens of thousands of passport and visa applications.