December 03, 2008

Recession reports – Global aviation business hit

AFP reported that economic slowdown in the US is taking a growing toll on the airline industry as passenger occupancy rates hit the lowest level for four years.

Mr Giovanni Bisignani director general of International Air Transport Association in a statement said that “The global passenger load factor fell to 73.3% in February, down 0.6% from the previous year.

He added that "Things are slowing down. Load factors tell the story. They fell in the four largest carrier regions showing the growing impact of the US economic slowdown on the airline industry.”

He noted that the weak US dollar is boosting exports and outbound business flights, while conversely the strong euro is damaging the competitiveness of European carriers.

IATA said that the European PLF saw the single biggest drop, down 1.6 percentage points to 71.7%. Asian carriers saw PLF fall by 0.1 percentage points to 75.2% while North American airlines dipped 0.5 percentage points to 74%. The Middle East saw PLF down 0.9 percentage points to 72.6%, though this was balanced against a 20.3% growth in passenger traffic supported by the oil business.