Home » 3PL/4PL » Cargo, passenger businesses slightly better in Oct – IATA

AFTER months of losses, member airlines of the International Air Transport Association (IATA) finally saw a 0.5% improvement each in their passage and cargo businesses in October.

The increase is a complete reversal from the more than 5% decline recorded a month earlier.

The load factors, however, remained at pre-recession levels of about 78% for passage and 54% for cargo.

“The crisis has cost the industry two years of growth. Adjusting costs and capacity to meet that reality will be challenging,” said IATA director general and CEO Giovanni Bisignani.

“The improve-ment in load factors to pre-recession levels is largely the result of careful capacity management.”

Compared to October 2008, passenger capacity was down 3.3% and cargo capacity dropped 7.4%.

Bisignani said cargo capacity adjustments came as a result of many freighters being placed in storage or retired, translating in a fleet reduction of 4.9%.

In contrast, the passenger fleet continues to expand by 1.8% as new deliveries more than offset those being stored or retired. Aircraft utilization for both wide and narrow-body aircraft is now 6% below early 2008 levels. This low asset utilization is increasing operating costs.

European carriers saw the biggest weakness in demand with a fall of 11.3% compared to October 2008 – relatively unchanged from the 13% drop in September. The region’s carriers were also the most aggressive in adjusting capacity with a 12.4% cut compared to previous-year levels.

Middle Eastern carriers saw a demand growth of 18.4%. This is significantly better than the 3.6% growth experienced in September and outpaced a capacity increase of 11.2%.

North American carriers saw a 0.5% uptick in demand against a 12% fall in capacity.

Latin American carriers recorded a 6.7% growth, significantly higher than the 1.8% in September.

Carriers in Asia-Pacific saw demand grow 1.9% compared to -3.1% in September. The region’s carriers have benefited from air freight generated by the earlier and stronger economic revival in the region, with industrial production now rising strongly in a number of economies.

African carriers saw demand decline 3.8%, an improvement from the -6.9% in September.

In the passage business, Asia-Pacific carriers saw demand grow 0.9%, lower than the 2.1% recorded in September. The carriers in this region, together with the European carriers, have seen demand rise the most from their low points.

While European carriers saw a demand decline of 3% in October, it is an improvement from the -4.2% in September. European carriers’ demand is still below the levels from last year due to weakness across the Atlantic and within Europe.

North American carriers saw significant growth in international traffic through the middle of 2009. Very significant capacity cuts across both the Atlantic and Pacific have reduced traffic carried in October to -2.6% below 2008 levels.

Middle Eastern carriers saw demand rise 14.3% (compared to 18.2% in September), the highest among the regions. The region’s carriers continue to add capacity, increasing 15.3% in October and outpacing the growth in demand.

Latin American carriers saw significant increases in demand for air travel, up 9% compared to 3.4% in September. The region’s carriers continue to add capacity, growing 3.7% compared to 2008.

African carriers saw demand decline 2.6% in October, an improvement from September’s -4.2%.

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