International air travel grew strongly in June, the International Air Transport Association (Iata) reported this week, and the trend continued in July.
African airlines benefited from strong domestic economic growth in key markets such as Ghana, Nigeria, Ethiopia and the Democratic Republic of the Congo with passenger load factors in June reaching 71.3 percent compared with an average of 69.6 percent for the year to date.
Iata economists commented that although their load factors still lagged the global average by about 10 percent, “they have made consistent progress to close the gap this year. In June they improved their load factors by almost 3 percent compared with June 2012.”
The report says European airlines were another highlight of the month.
“They reported a second consecutive month of solid growth reflecting an easing in recessionary conditions in the eurozone and an improvement in business and consumer confidence. Emerging markets were again the strongest perfomers, particularly in Africa and the Middle East.
“June was a positive month for passenger markets. The stability in the eurozone, albeit tentative, is giving a boost to business and consumer confidence,” Tony Tyler, the director-general and chief executive of Iata, commented.
“But there are some headwinds. Growth in the Brics (Brazil, Russia, India, China, South Africa) countries is slowing and oil prices remain high. The industry is still on track to make $4 (R39.50) per passenger this year for a global net profit of $12.7 billion. But there is little margin for error and even a small change in the second half of the year could shift the outlook significantly.
“There is plenty of evidence to support some cautious optimism. Airlines are expecting continued growth in demand but there is little immediate hope for an improvement in yields. In the short term, cost control remains high on every airline’s agenda and the longer term challenge is to expand value streams to generate sustainable levels of profitability.”
Iata’s financial monitor for June and July says that jet fuel prices climbed back above $120 a barrel in July as a result of “temporary supply and demand impacts, with strong passenger demand enabling passenger loads to reach a new record level in June.”
Passenger loads rose despite deliveries of new aircraft while other planes were taken out of storage during the month.