Drive American

Published on Friday, August 5, 2016

Terror attacks and economic uncertainty hit travel demand

Demand for travel is growing but at a slower pace, according to the latest figures from airline body IATA.

Director General and CEO Tony Tyler said a 'fragile and uncertain economic backdrop, political shocks and a wave of terrorist attacks' are all contributing to a 'softer demand environment'.

"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," he continued.

"But it is vital that governments recognise and support aviation's ability to contribute to global economic well-being and better understanding across cultural and political borders."

June figures show demand, measured in revenue passenger kilometers, rose by 5.2% compared to June last year.

This was up slightly from the 4.8% increase recorded in May, but the upward trend in seasonally-adjusted traffic has moderated since January.

June capacity, or available seat kilometers, increased by 5.6% and load factor slipped 0.3 percentage points to 80.7%.

June international passenger demand rose 5% compared to June 2015.

All regions recorded growth, led by airlines in Latin America. Capacity climbed 6.4%, causing load factor to slide 1.1 percentage points to 79.4%.

European carriers saw demand rise 2.1%, the smallest increase among regions, reflecting the negative impact of recent terrorism.

"While demand tends to recover reasonably quickly after such events, the repeated nature of the attacks may have a more lasting impact," said IATA.

Capacity climbed 3.4% and load factor slipped 1.1% percentage points to 83.3%.

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