Thursday, September 01, 2011

Airline industry soaring this summer

An improving global economy has helped airlines take flight this summer, pushing them to their best travel season in years.

The International Air Traffic Association says flight loads were 5.9 per cent higher in July than they were the same month a year ago.

"This increase was likely based on the much more optimistic economic outlook that marked the beginning of the year," the Paris-based body's CEO, Tony Tyler, said Thursday.

International flights were particularly in demand, with the agency saying flights between two countries saw demand rise by 7.3 per cent. That's better than the pickup in domestic flights, of 3.5 per cent.

Compared to how things were before the recession in 2008, international passenger flights are now up by 12 per cent.

"July is the peak in the annual cycle for passenger traffic. This year was no exception," Tyler said. "But even if the industry’s performance could be classified as stronger than expected, we do face headwinds as we look towards the end of the year."

Regionally, Latin American carriers fared best of all, on average, with an increase of 10.3 per cent over last July. Middle Eastern airlines were close behind at 9.7 and European ones at 9.3. Comparatively speaking, North American airlines fared the worst, with traffic only increasing by 3.9 per cent over the 12 months.

But a slightly worse economic picture through the summer means the agency expects those number will come down a bit by the end of the year. And freight traffic remains in the doldrums, down 0.4 per cent compared to where it was a year ago.

The sluggishness in domestic demand could be reason for concern moving forward. The U.S. domestic market makes up 50 per cent of the world's market, and it only grew by a little over two per cent compared to July 2010, IATA noted.

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