Political unrest, quakes hit air travel in March

MUMBAI: For the second year in a row, weather-related catastrophes have hit international air traffic. If it was Iceland's volcanic eruptions last year, it's the tsunami and earthquakes of Japan this year that crippled the growth in passenger traffic. But it was not just the weather, for the airline industry, the year began on a difficult note with political unrest in countries in North Africa.

The International Air Transport Association (IATA) announced scheduled international traffic results for March 2011 showing that year-on-year growth in passenger demand had slowed to 3.8% from the 5.8% recorded in February. Conversely, year-on-year growth in freight markets rebounded to 3.7% in March from the 1.8% recorded in February. Compared to February, global passenger demand fell by 0.3% in March, while cargo demand expanded by 4.5%.

``The profile of the recovery in air transport sharply decelerated in March. The global industry lost 2 percentage points of demand as a result of the earthquake and tsunami in Japan and the political unrest in the Middle East and North Africa (MENA),'' said Giovanni Bisignani, IATA's Director General and CEO. The impact of the events in Japan on global international traffic was a 1% loss of traffic in March. Looked at regionally, Asia-Pacific carriers saw a traffic loss of over 2%, North American carriers had a 1% drop and Europe's carriers a 0.5% fall. Japan's domestic market was the most severely impacted with a 22% fall in demand. The disruptions in MENA cut international travel by 0.9 percentage points. Egypt and Tunisia experienced traffic levels 10-25% below normal for March. Military action in Libya virtually stopped civil aviation to, from and within that country. Capacity adjustments lagged behind the sudden drop in demand. Against global demand growth of 3.8%, capacity expanded by 8.6%. The average load factor fell by 3.5 percentage points to 74.6%.

Asia-Pacific carriers saw the broadest negative turn of fortunes in March. Compared to the previous year passenger demand was flat. Compared to February however demand contracted by 2.2% while 0.8% was added to capacity. This led to a sharp 2.3 percentage point fall in load factors to 74.2% in March. Also, Asia-Pacific carriers, which account for 43% of global freight markets, saw air freight demand contract by 0.6% in March compared to the previous year. This is considerably better than the 5.4% fall in February which was exceptionally depressed due to plant closures associated with the Chinese New Year. Compared to February, freight demand actually improved by 8.2%. Were it not for the earthquake and tsunami in Japan, the rebound would have been much stronger.