International Air Transport Association

Air Transport Market Analysis - May 2011


Released 30 June 2011


Key points from our full report on
air transport markets in
May:

 

 

  • May saw a stronger expansion of air travel and freight, after the soft patch of the previous three months;
  • Air travel volumes (RPK) were 6.8% higher than a year earlier, and the level of the market in May was 4% up on the start of the year;
  • The year-on-year decline in air freight of 4% was distorted by the spike last May - freight volumes in May were 2% higher than the start of the year;
  • Looking at the trend through a volatile few months both travel and freight appear to be expanding now at an average annualized pace of 4%;
  • Also encouraging was a rebound in passenger load factors, which restored much of the ground lost since the peak in 2010Q3;
  • Freight load factors saw less of a bounce but nevertheless this partial recovery in utilization will help ease the squeeze on airline profits in Q2;
  • Domestic travel markets were mostly strong, particularly in India though Chinese markets are showing the effects of tighter economic policies;
  • The Japanese market showed the first signs of rebounding in May but was still down one quarter on pre-earthquake levels;
  • International markets experienced stronger growth than domestic air travel in May, helped by a strong rebound in the traffic carried by African airlines;
  • Traffic volumes carried by African airlines, affected by unrest in the north, have risen 16% from February lows to a level 5% below pre-unrest levels;
  • Other emerging markets in Asia and South America also experienced strong growth in air travel, driven by rapidly expanding economies and trade;
  • European airlines, despite some very weak home markets, expanded capacity and traffic over 10%, whereas N American airlines took a much more cautious approach in May;
  • IATA's forecast for 4.4% RPK growth in 2011 is consistent with some slowdown of the recent trend during the second half of this year, due to slower economic growth and high fuel prices;
  • If travel markets maintain their present trend then we may be underestimating the outlook - however the opposite is the case for freight which is expanding at a disappointingly slow pace.

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