Middle East airlines see strongest growth in passenger demand in Nov

Middle East airlines posted the strongest growth in international passenger demand in November across all regions worldwide, according to a report by the International Air Transport Association (IATA).

Regional carriers saw a 12.2 per cent demand increase, IATA stated.

“But the upward trend in the region’s seasonally adjusted traffic has paused, with November’s level coming in unchanged from that of July,” the report added.

Capacity rose 11.6 per cent and load factor rose 0.3 percentage points to 68.7 per cent.

Globally, November international passenger demand rose 8 per cent compared to the year earlier, with airlines in all regions posting growth during the month.

Capacity climbed 6.8 per cent, and load factor edged up 0.9 percentage points to 77.1 per cent.

Meanwhile domestic travel demand rose 7.1 per cent year-on-year in November 2016, but results continued to vary widely, with China, India and Russia showing double-digit growth while demand declined in Brazil and Japan.

“Stronger demand for air travel reflects — and is supporting – a pick-up in the global economic cycle,” said Alexandre de Juniac, IATA’s director general and CEO.

Overall, the report found that global passenger traffic in November 2016 showed the strongest demand growth in nine months, with total revenue passenger kilometers (RPKs) rising 7.6 per cent year-on-year.

Looking ahead, with the stimulus effect of lower oil prices receding, the strength of the economic cycle will play a key role in the pace of demand growth in 2017, said Juniac.

“The airline industry continues to deliver strong results. In 2017, for a third consecutive year, the industry’s return on invested capital will exceed the cost of capital. Passengers benefit from the industry’s success. Travel has never been more accessible — with great fares, many options and more destinations.

“Nevertheless uncertainty lies ahead. The threat of terrorism, questions over the durability of the economic upswing, rising oil prices and increasing protectionist rhetoric are among the concerns. The industry has reshaped itself and strengthened its resilience to shocks.

“We should see another solid year of collective profitability for the airlines in 2017. But we must be vigilant,” he added.