As economical uncertainty in the world continues this is causing both consumers and business to hold on their spending. The resulting financial situation causes more and more airlines to close part of their routes or even to shut down their business altogether. Though air traffic was still growing despite all these economical conditions, things changed from the middle of the year, as air traffic growth became slower and data shows a continuing slowing trend in July and August. According to IATA demand for air travel in June was growing by 6.2%.
Though it is a healthy growth rate, the trend decreases. In July passenger air traffic growth compared to same period in previous year was by only 3.4% higher. Air traffic demand in August increased up to 5.1% however it is mainly due to “positive distortion owing to the timing of Ramadan” and if looking at adjusted numbers, demand remains basically flat.
Strongest air traffic growth remains in Middle East region showing 18.2% year over year growth in June and 11.2% in July. Though growth rates in this region are declining as everywhere, air travel demand in this region remains higher than anywhere else. Higher rates are partly the reflection of the airport infrastructure investments across the region. Besides, in July and August region’s growth trends were impacted by Ramadan.
Though Asia – Pacific region was experiencing strong and steady growth, from the middle of 2012 air traffic demand stopped growing and growth rates started to decline comparing to previous year. In June air traffic growth was 6%, but in July growth almost stopped barely reaching 1%. According to IATA European airlines appear to be benefiting more than Asia-Pacific airlines from the recently stronger trade flows from West to East.
Europe carriers experienced strong 7.3 % growth in June, which according to IATA was more likely a result of volatility in weak market conditions. In July European airlines recorded 4.8% traffic growth compared to same period last year. As economical uncertainty is a very strong factor in this region for air travel demand, decrease in year over year growth is not unexpected, however many airlines benefited from higher traffic to regions where economic growth is stronger, especially Middle East region.
African air travel demand continues to grow at much higher rates compared to previous year. In June air traffic growth was 10.1% and in July it was 5.2% compared to last year. Air traffic growth is primarily driven by a liberalization of air transport industry and better economical conditions of many African countries.
After continuous decline in 2011 North America’s air traffic started to grow at the beginning of the year, however in April growth stopped at approximately 2% compared to previous year. In July traffic demand started to decline again, reaching -2.1%. According to IATA this was in part owing to decisions to trim capacity, particularly on the North Atlantic market.
Latin America continues to experience one of the fastest growths. In June air traffic growth rate was 11.2% that is second highest result after Middle East region. However in July demand started to slow down as a result growth rate decreased to 5.7%. Air traffic in Latin America was affected by slower economical growth in the region.