Global air traffic hit by terror concerns

The growth of global air passenger traffic is softening due to concerns about global terrorism and the economy, new data suggests.

In its monthly report for June 2016, the International Air Transport Association (IATA) revealed that global demand for flights (both domestic and international) increased just 5.2% in June. This fell below the rate of capacity growth (+5.6%), meaning that global passenger load factors – or the number of seats filled on flights – declined 0.3 percentage points to 80.7%.

And tellingly, Europe, which has suffered several high-profile terrorist attacks in recent months, experienced the world’s lowest growth rates in June, with traffic rising just 2.0% and load factors falling 0.6 points to 82.9%.

Asia Pacific experienced the world’s strongest growth, with passenger demand up 9.0% and load factors increasing 1.3 points to 79.1%.

“The demand for travel continues to increase, but at a slower pace. The fragile and uncertain economic backdrop, political shocks and a wave of terrorist attacks are all contributing to a softer demand environment,” said Tony Tyler, IATA’s director general & CEO.

Globally, international air traffic grew at a rate of 5.0% in June, compared to domestic markets which increased 5.7%. Asia Pacific (+8.2%) again saw strong rates of international passenger traffic growth, but IATA noted that June’s growth rate was “barely higher than in February”, which it said “could be a natural pause, but possibly is also a sign of Asian passengers being put off travel by terrorism in Europe”.

A Ramadan-affected Middle East saw a 7.5% rise in passenger traffic, but the world’s highest growth rates were seen in Latin America (+8.8%) – somewhat of a surprise for a region struggling under the weight of economic pressure. European carriers saw international passenger demand rise 2.1%, the smallest increase among regions, reflecting the impact of recent terrorism.

In terms of domestic markets, India’s demand surge shows no sign of abating, following a 23.3% jump in domestic traffic in June. Indian load factors are also now averaging a healthy 82.6%. China (+11.3%) also continues to thrive, and traffic in the US – the world’s largest domestic market – climbed 4.5%. In Brazil however, domestic air traffic declined 6.5%.

“It is too soon to know whether recent terrorist attacks will have a long-term negative influence on demand, nor what will be the impact of Brexit and the events in Turkey,” said Tyler. “But it is vital that governments recognize and support aviation’s ability to contribute to global economic well-being and better understanding across cultural and political borders.”