Commercial tensions between the US and China slow down the demand to travel between the two powers
Global passenger air traffic increased by 5% in June compared to the same month last year, with an average capacity increase by airlines of 3.3% and a load factor of 84.4 %, 1.4 percentage points, which broke the record for a month of June, according to the International Air Transport Association (IATA), which brings together 82% of air flow worldwide.
“The month of June continued with the trend of solid growth in passenger demand, while the record occupancy factor shows that airlines are maximizing efficiency,” said IATA director and CEO Alexandre de Juniac.
However, he added that “trade tensions between the United States and China, and the growing uncertainty in the economic scenario in other regions has left a mark on June performance.” World passenger air traffic grew 5% in June
5.4% GROWS IN THE INTERNATIONAL MARKET
In the international market, the demand for passenger traffic increased 5.4% compared to June 2018, which represents an improvement in growth compared to May, when it grew 4.6%.
In all regions there was an increase in growth, led by African airlines. Capacity increased 3.4% and the load factor increased 1.6 percentage points, to 88.3%.
In Europe, the traffic increase was 5.6% in June, while capacity increased 4.5%. The load factor stood at 87.9%, one more percentage point. This solid growth occurred in a context of slowing down economic activity and decreasing business confidence in the euro zone and the United Kingdom.
Middle Eastern airlines recorded a demand increase of 8.1% in June compared to the same month last year, after the 0.6% growth recorded in May. The Ramadan calendar contributed to these disparate results. Capacity grew by 1.7% and the load factor increased 4.5 percentage points to 76.6%.
In Asia-Pacific, demand growth was 4% in June, while capacity increased by 3.1% and the load factor rose 0.7 percentage points to 81.4%. Trade tensions between the United States and China have affected demand to travel between the two powers, as well as within the inter-Asian market.
The North American airlines saw a 3.5% increase in the demand for passengers in the international market, which represents a decrease with respect to the 5% growth in May and reflects the commercial tensions between the United States and China. Capacity increased by 2% with a load factor increase of 1.3 percentage points to 87.9%.
In Latin America they experienced a 5.8% increase in international traffic compared to the same month last year, capacity increased 2.5% and the load factor was 84%, 2.6 percentage points more. The weakening of economic conditions in several key countries in the region could mean a weakening of demand in the future.
Finally, African airline traffic grew 11.7% in June compared to 5.1% in May. Capacity increased 7.7% and the load factor increased 2.6 percentage points, to 70.5%. Demand in this region is benefiting from a favorable economic context, which includes greater economic stability in several countries and greater air connectivity.
DOMESTIC DEMAND INCREASES 4.4%
Demand for passengers in domestic markets increased 4.4% in June compared to the same month of 2018, although it represents a slight deceleration compared to May, when it was 4.7%.
With Russia at the helm, all the key national markets monitored by IATA reported increases in traffic, except Brazil and Australia. Capacity increased by 3.1% and the load factor rose 1.1 percentage points, to 85.5%.
In Brazil, the 5.7% drop in domestic demand in June reflects the collapse of the country’s fourth largest airline, Avianca Brasil, which had around 14% market share in 2018.
Meanwhile, the market in India continues to recover from the disappearance of Jet Airways, with an increase of 7.9% in June compared to last year.