Airlines experience strongest growth in more than a decade so far in 2017

Airlines around the world experienced the fastest growth in demand for more than a decade in the first half of calendar 2017 amid a stronger economic backdrop and cheap tickets, the International Air Transport Association (IATA) says. The airline industry group’s air passenger market analysis report showed revenue passenger kilometres (RPK) rose 7.9 per cent in the six months to June 30 2017, compared with the prior corresponding period. It was the largest first half pickup in demand since 2005, the IATA report said. A brighter economic picture and lower airfares are keeping demand for travel strong, IATA chief executive and director general Alexandre de Juniac said in a statement. But as costs rise, this stimulus of lower fares is likely to fade. And uncertainties such as Brexit need to be watched carefully. Nonetheless, we still expect 2017 to see above-trend growth. With RPK growth exceeding capacity increases, measured by available seat kilometres (ASK), of 6.1 per cent, passenger load factors rose 1.3 percentage points to 80.7 per cent in the first half. All regions reported growth, with airlines in the Asia Pacific region leading the way as RPKs growth of 10.6 per cent outpaced ASK expansion of 7.9 per cent. As a consequence, load factors jumped two percentage points to 80.8 per cent in the first half of calendar 2017 for airlines in this part of the world. The IATA report showed the Australian domestic market continued be flat, with airlines cutting capacity in an effort to better match demand with the number of seats in the market.

Source: Civil Aviation Authority, Qatar