Thu 31 Jan 2008 – Full-year figures for 2007 released by the International Air Transport Association (IATA) show international passenger traffic demand grew 7.4%, up considerably from the 5.9% recorded in 2006, contributing to the first year of airline profitability since 2000. However, the organization predicts growth will slow to 5% in 2008 on the back of dampening demand.
IATA points to passenger demand in December which, while growing by 6.7%, was slow compared to the 9.3% jump in November, and is evidence of the impact of rising prices and economic uncertainty.
Average international load factors reached an industry record of 77.0% in 2007, up from 76.0% in 2006 and 75.1% in 2005. However, says IATA, this trend will end in 2008 as the growth slows to 5% while capacity is forecast to rise 5.2%.
The results showed passenger growth in most regions of the world and largely mirror those just released by the World Tourism Organization (see story). Carriers in the Middle East recorded an 18.1% increase in demand, the highest of all regions, largely due to the impact of oil wealth, expanded capacity and new routes.
This week, Dubai International Airport laid claim to being the world’s fastest growing airport in 2007. Handling a total of 34.34 million passengers, it recorded a growth rate of 19.31%. For the sixth consecutive year, the airport has maintained an average growth rate of over 15%. It handled a total of 260,530 movements in 2007 as against 237,258 in 2006, an increase of 9.81%, with 120 scheduled airlines now serving Dubai.
Latin American airlines reversed the 2.4% fall in 2006 with a growth of 8.4% in 2007 and African carriers recorded above average growth of 8%, reflecting the strong economic growth and successful market liberalization in parts of the continent.
Asia Pacific carriers’ growth of 7.3% was helped by the continuing strength and expansion of the Chinese and Indian markets. Europe saw demand rise from 5.3% in 2006 to 6.0% in 2007, reflecting steady economic growth and the expansion of long-haul routes to Asia and the Middle East.
By contrast, North America recorded 5.5% growth in 2007 compared to 5.7% in 2006. Similarly, international air freight traffic grew by 4.3% in 2007, down slightly from growth of 4.6% in 2006 and much lower than the 7-8% growth trend of recent years.
“Despite the ambiguity of strong passenger growth accompanied by weaker freight demand, we can say clearly that 2007 was the best in recent memory,” reflected Giovanni Bisignani, IATA’s Director General and CEO. “We can state equally clearly that there will be no encore performance in 2008. Oil prices are higher than ever. Economic uncertainty accompanying the US credit crunch is broadening. And the slower growth for passenger demand in December sets the trend for the coming months.”